[Congressional Record Volume 149, Number 49 (Wednesday, March 26, 2003)]
[Senate]
[Page S4444]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ALLEN (for himself, Mr. McCain, Mr. Chambliss, and Mr. 
        Graham of South Carolina):
  S. 721. A bill to amend the Internal Revenue Code of 1986 to expand 
the combat zone income tax exclusion to include income for the period 
of transit to the combat zone and to remove the limitation on such 
exclusion for commissioned officers, and for other purposes; read the 
first time.
  Mr. ALLEN. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 721

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

     SECTION 1. EXPANSION OF INCOME TAX EXCLUSION FOR COMBAT ZONE 
                   SERVICE.

       (a) Combat Zone Service To Include Transit to Zone.--
     Section 112(c)(3) of the Internal Revenue Code of 1986 
     (relating to definitions) is amended by adding at the end the 
     following new sentence: ``Such service shall include any 
     period of direct transit to the combat zone.''.
       (b) Removal of Limitation on Exclusion for Commissioned 
     Officers.--
       (1) In general.--Subsection (b) of section 112 of the 
     Internal Revenue Code of 1986 (relating to certain combat 
     zone compensation of members of the Armed Forces) is 
     repealed.
       (2) Conforming amendments.--
       (A) Section 112(a) of such Code is amended--
       (i) by striking ``below the grade of commissioned 
     officer'', and
       (ii) by striking ``Enlisted Personnel'' in the heading and 
     inserting ``In General''.
       (B) Section 112(c) of such Code is amended by striking 
     paragraphs (1) and (5) and by redesignating paragraphs (2), 
     (3), and (4) as paragraphs (1), (2), and (3), respectively.
       (c) Effective Date.--The amendments made by this section 
     shall apply to months beginning after the date of the 
     enactment of this Act.

     SEC. 2. AVAILABILITY OF CERTAIN TAX BENEFITS FOR MEMBERS OF 
                   THE ARMED FORCES PERFORMING SERVICES AT 
                   GUANTANAMO BAY NAVAL STATION, CUBA, AND IN THE 
                   HORN OF AFRICA.

       (a) General Rule.--In the case of a member of the Armed 
     Forces of the United States who is entitled to special pay 
     under section 310 of title 37, United States Code (relating 
     to special pay: duty subject to hostile fire or imminent 
     danger), for services performed at Guantanamo Bay Naval 
     Station, Cuba, or in any country located in the region known 
     as the Horn of Africa as part of Operation Enduring Freedom 
     (or any successor operation), such member shall be treated in 
     the same manner as if such services were in a combat zone (as 
     determined under section 112 of the Internal Revenue Code of 
     1986) for purposes of the following provisions of such Code:
       (1) Section 2(a)(3) (relating to special rule where 
     deceased spouse was in missing status).
       (2) Section 112 (relating to the exclusion of certain 
     combat pay of members of the Armed Forces).
       (3) Section 692 (relating to income taxes of members of 
     Armed Forces on death).
       (4) Section 2201 (relating to members of the Armed Forces 
     dying in combat zone or by reason of combat-zone-incurred 
     wounds, etc.).
       (5) Section 3401(a)(1) (defining wages relating to combat 
     pay for members of the Armed Forces).
       (6) Section 4253(d) (relating to the taxation of phone 
     service originating from a combat zone from members of the 
     Armed Forces).
       (7) Section 6013(f)(1) (relating to joint return where 
     individual is in missing status).
       (8) Section 7508 (relating to time for performing certain 
     acts postponed by reason of service in combat zone).
       (b) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), this 
     section shall take effect on the date of the enactment of 
     this Act.
       (2) Withholding.--Subsection (a)(5) shall apply to 
     remuneration paid on or after such date of enactment.
                                 ______