I 111th CONGRESS 1st Session H. R. 3707 IN THE HOUSE OF REPRESENTATIVES October 1, 2009 Mr. Garrett of New Jersey introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to exclude combat zone compensation of members of the Armed Forces from employment taxes.

1.

Short title

This Act may be cited as the Armed Forces Tax Relief Act of 2009.

2.

Exclusion of combat zone compensation of members of the Armed Forces from employment taxes

(a)

In general

Paragraph (2) of section 3121(i) of the Internal Revenue Code of 1986 (relating to service in the uniformed services) is amended by adding at the end the following new sentence: The term wages shall not include remuneration for active service performed in a month for which such individual is entitled to the benefits of section 112 (relating to certain combat zone compensation of members of the Armed Forces of the United States) to the extent remuneration for such service is excludable from gross income under such section.. (b)

Social Security trust funds held harmless

There is hereby appropriated (out of any money in the Treasury not otherwise appropriated) for each fiscal year to each fund under the Social Security Act an amount equal to the reduction in the transfers to such fund for such fiscal year by reason of the amendment made by subsection (a). (c)

Effective date

The amendment made by this section shall apply with respect to service performed after December 31, 2008.