[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 994 Introduced in House (IH)]






109th CONGRESS
  1st Session
                                H. R. 994

 To amend the Internal Revenue Code of 1986 to allow Federal civilian 
  and military retirees to pay health insurance premiums on a pretax 
   basis and to allow a deduction for TRICARE supplemental premiums.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 1, 2005

  Mr. Tom Davis of Virginia (for himself, Mr. Porter, Mr. Waxman, Mr. 
 Davis of Illinois, Mr. Moran of Virginia, Mr. Hoyer, Mr. Van Hollen, 
  Mr. Wolf, Ms. Norton, Mrs. Jo Ann Davis of Virginia, Mr. Coble, Mr. 
Kolbe, and Mr. Wynn) introduced the following bill; which was referred 
 to the Committee on Ways and Means, and in addition to the Committees 
      on Government Reform and Armed Services, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to allow Federal civilian 
  and military retirees to pay health insurance premiums on a pretax 
   basis and to allow a deduction for TRICARE supplemental premiums.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. PRETAX PAYMENT OF HEALTH INSURANCE PREMIUMS BY FEDERAL 
              CIVILIAN AND MILITARY RETIREES.

    (a) In General.--Subsection (g) of section 125 of the Internal 
Revenue Code of 1986 (relating to cafeteria plans) is amended by adding 
at the end the following new paragraph:
            ``(5) Health insurance premiums of federal civilian and 
        military retirees.--
                    ``(A) FEHBP premiums.--Nothing in this section 
                shall prevent the benefits of this section from being 
                allowed to an annuitant, as defined in paragraph (3) of 
                section 8901 of title 5, United States Code, with 
                respect to a choice between the annuity or compensation 
                referred to in such paragraph and benefits under the 
                health benefits program established by chapter 89 of 
                such title 5.
                    ``(B) TRICARE premiums.--Nothing in this section 
                shall prevent the benefits of this section from being 
                allowed to an individual receiving retired or retainer 
                pay by reason of being a member or former member of the 
                uniformed services of the United States with respect to 
                a choice between such pay and benefits under the health 
                benefits programs established by chapter 55 of title 
                10, United States Code.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

SEC. 2. DEDUCTION FOR TRICARE SUPPLEMENTAL PREMIUMS.

    (a) In General.--Part VII of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to additional itemized 
deductions for individuals) is amended by redesignating section 224 as 
section 225 and by inserting after section 223 the following new 
section:

``SEC. 224. TRICARE SUPPLEMENTAL PREMIUMS OR ENROLLMENT FEES.

    ``(a) Allowance of Deduction.--In the case of an individual, there 
shall be allowed as a deduction the amounts paid during the taxable 
year by the taxpayer for insurance purchased as supplemental coverage 
to the health benefits programs established by chapter 55 of title 10, 
United States Code, for the taxpayer and the taxpayer's spouse and 
dependents.
    ``(b) Coordination With Medical Deduction.--Any amount allowed as a 
deduction under subsection (a) shall not be taken into account in 
computing the amount allowable to the taxpayer as a deduction under 
section 213(a).''.
    (b) Deduction Allowed Whether or not Individual Itemizes Other 
Deductions.--Subsection (a) of section 62 of such Code is amended by 
inserting before the last sentence at the end the following new 
paragraph:
            ``(21) TRICARE supplemental premiums or enrollment fees.--
        The deduction allowed by section 224.''.
    (c) Clerical Amendment.--The table of sections for part VII of 
subchapter B of chapter 1 of such Code is amended by striking the last 
item and inserting the following new items:

``Sec. 224. TRICARE supplemental premiums or enrollment fees.
``Sec. 225. Cross reference.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 3. IMPLEMENTATION.

    (a) FEHBP Premium Conversion Option for Federal Civilian 
Retirees.--The Director of the Office of Personnel Management shall 
take such actions as the Director considers necessary so that the 
option made possible by section 125(g)(5)(A) of the Internal Revenue 
Code of 1986 shall be offered beginning with the first open enrollment 
period afforded under chapter 89 of title 5, United States Code, which 
begins not less than 90 days after the date of the enactment of this 
Act.
    (b) TRICARE Premium Conversion Option for Military Retirees.--The 
Secretary of Defense, after consulting with the other administering 
Secretaries (as specified in section 1073 of title 10, United States 
Code), shall take such actions as the Secretary considers necessary so 
that the option made possible by section 125(g)(5)(B) of the Internal 
Revenue Code of 1986 shall be offered beginning with the first open 
enrollment period afforded under health benefits programs established 
under chapter 55 of such title which begins not less than 90 days after 
the date of the enactment of this Act.
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