[Congressional Record Volume 140, Number 118 (Friday, August 19, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 19, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
      CONSTITUENT SUGGESTIONS FOR TAX BILLS ARE RIGHT ON THE MONEY

                         HON. NANCY L. JOHNSON

                             of connecticut

                    in the house of representatives

                        Friday, August 19, 1994

  Mrs. JOHNSON of Connecticut. Mr. Speaker, today I am pleased to 
introduce three bills that I believe will vastly improve the fairness 
of the Tax Code. Most impressive, Mr. Speaker, is that all three come 
from solid suggestions by Connecticut constituents.
  The first bill allows overnight camp expenses to qualify for the 
dependent care tax credit. Under current law, only traditional day care 
services are deductible, creating a clear disadvantage for those lucky 
enough to identify reasonably priced overnight camps for summertime 
child care. Thus, under my bill, parents who send their children to 
overnight camp will be eligible to deduct a portion of their expenses, 
subject to the same terms and restrictions as other day care users.
  My second bill, though a bit narrower and more complicated, addresses 
another fairness issue important to many Americans. This legislation 
would allow the waiver of survivor annuity benefits assigned before 
marriage.
  When the Retirement Equity Act was passed by Congress in 1984, it did 
not address the issue of prenuptial agreements. The act requires 
spousal consent for you to name someone other than your spouse as your 
beneficiary.
  The growth of 401(k) retirement plans and the number of remarriages 
is likely to result in an increasing number of legal disputes following 
the death of the plan participant who obtained prenuptial consent from 
a spouse. After the participant's death, the new spouse and the 
participant's children from a prior marriage will fight over who is 
entitled to the deceased's 401(k) account balance which, thanks to 
compound interest over a number of years, can be substantial.
  For example, assume a single parent joins a 401(k) plan and names his 
or her children as beneficiaries. If the single parent remarries, the 
new spouse automatically becomes the primary beneficiary, even though 
the forms on file name the children as beneficiaries.
  Lastly, my bill to allow totally disabled persons the same one-time 
exclusion of $125,000 profit from the sale of a principal residence is 
long overdue. Under current tax law, those over 55 years old may 
exclude from taxation up to $125,000 in sales profits.
  This tax break helps senior citizens who wish to sell a large family 
home to move into a smaller home or condominium and avoid huge capital 
gains taxes on the profits not invested in the new home. Since disabled 
folks may find themselves in need of smaller or more specialized 
accommodations, it is only fair that they enjoy this limited tax break 
as well. Under my bill, those who qualify as fully disabled under 
Social Security or Veterans' Administration rules, will be eligible for 
this benefit.
  I commend these measures to my colleagues and look forward to their 
prompt review in the Committee on Ways and Means.

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