[Congressional Record (Bound Edition), Volume 149 (2003), Part 5]
[House]
[Pages 6541-6543]
[From the U.S. Government Publishing Office, www.gpo.gov]



  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentleman from 
Michigan (Mr. Levin), a senior member of the Committee on Ways and 
Means.

                              {time}  1115

  Mr. LEVIN. This is an important bill. Many of us regret that it could 
not have been brought to this floor earlier without provisions that 
were totally unrelated to its basic purpose. It is important because so 
many of our Reserve and Guard members today are overseas, along with 
others, and what this bill says very significantly is that all members 
of our Armed Forces should be treated with equity and treated with the 
utmost sensitivity and respect.
  The bill is important because we bring it up today at a significant 
moment. What it says, I think, for all of us, is this: Whatever the 
disagreements, and there have been and remain such as to the policies 
and approach of this administration, we here stand fully behind those 
men and women who are fighting in our armed services.
  So I hope that today we will join in support of this bill. It now has 
a single important purpose, and that is to say to our troops, here and 
abroad, we stand with you.
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the gentleman from New York (Mr. McNulty) eloquently 
indicated that freedom is not free, and that his own brother did not 
return in paying the ultimate price.
  Mr. Speaker, it is my pleasure to yield such time as he may consume 
to the gentleman from Texas (Mr. Sam Johnson), who served his country 
admirably, and did return with an amazing story.
  Mr. SAM JOHNSON of Texas. Mr. Speaker, this is for our military, and 
thank goodness we have got it for them all the way through.
  Last spring a constituent of mine, Paul Miesse, was researching 
college savings plans, including the State education plans. His son 
Kyle, in Junior ROTC, would like to someday apply to the Naval Academy, 
as well as other schools.
  Currently 529 State plans and Coverdell Education Savings Accounts 
allow people to save for college, and those savings remain untaxed if 
spent on education costs. It is a responsible thing for parents to save 
for their children's education, but if the student is smart enough or 
athletic enough to get a scholarship, then the parents can get their 
money back from the 529 plan or Coverdell plan penalty free. However, 
because of an oversight, which is rectified in this bill, military 
academies do not qualify for that penalty-free rebate of their savings.
  I think that when hard-working, patriotic young Americans are 
rewarded with an appointment to a service academy, we ought not turn 
around and impose a 10 percent penalty on their parents who diligently 
saved for their children's education. We should provide the same 
penalty-free withdrawals for the Zoomie, the Plebe, the Middy or the 
Cadet as we provide to those who play sports, earn an academic 
scholarship or pay for school through ROTC.
  This change we are making today will ensure that students who attend 
our U.S. military academies get the same treatment under college 
savings plans as their peers.
  Given that each of us is eligible to make appointments to the United 
States service academies, I think all of us in Congress have a direct 
interest in making sure we solve this problem. In fact, there are 50 
students in the Third District, my district, at all of the academies at 
any given time.
  I want to thank constituents Paul, Jeanette and Kyle Miesse of Plano, 
Texas, who brought this issue to my attention. I think our forefathers 
envisioned that it is people like the Miesses of Texas who really make 
a difference, and it is our servicemen overseas and in this country who 
defend this freedom, and that is who we are trying to protect. I urge 
support of this bill.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, again, I would like to say that we should feel very 
proud that we are making this minor adjustment to improve the quality 
of life by reducing tax liability on men and women in uniform. It is 
hard for me to believe that as we talk, it is suggested that we are 
reducing the money for education for those people who are in uniform 
around the country, those that are dependent on Federal funds to 
support the localities where the men and women are stationed here in 
the United States. In addition to that, we are cutting back on aid for 
our veterans.
  I would hope that in the spirit in which we pass this very modest 
bill, that all of us, Republicans and Democrats, liberals and 
conservatives, make some spirited effort to not have patriotism just be 
a flag on the bumper of a car, but to make some special effort to give 
priorities to those men and women in uniform by making certain that 
their kids are not denied an opportunity to get an education, and 
making certain that those who go in and serve, that their benefits are 
not being reduced.
  Having said that, I would like to close on this and indicate that I 
think it is worthwhile that we get a record vote on this legislation 
not so much for political reasons, but so that our men and women would 
know that they would have a unanimous vote by the House of 
Representatives not only on this bill, but many bills that I hope will 
come before us where we can differ with the policy, but we will make it

[[Page 6542]]

unequivocal support for those who volunteer to salute our great flag 
and our great country.
  Mr. Speaker, I yield back the balance of my time.
  Mr. THOMAS. Mr. Speaker, I want to join in the statement of the 
gentleman from New York.
  Mr. REYES. Mr. Speaker, I am proud to support the members of our 
Nation's armed services and vote for the Armed Forces Tax Fairness Act 
that recognizes their contributions to our Nation and our freedom. The 
men and women of the Armed Forces, more than any other group, deserve 
to be first in line when Congress considers tax cuts and special 
exemptions from tax obligations. At a time when so much is being asked 
of our service members, it is only appropriate that we make this 
effort.
  The Armed Forces Tax Fairness Act will make tax free the entire 
$6,000 death gratuity paid to survivors of service members killed in 
the line of duty. The bill also makes payments from the Defense 
Department's Homeowners Assistance Program tax free.
  The bill reduces taxes for some service members who sell their home 
by making changes to capital gains taxes on the sale of residences. The 
new rules will be helpful to those who have served on multiple 
deployments and have therefore lived at their residence for less than 2 
of the last 5 years.
  Recognizing the important role played by members of the National 
Guard, especially at this time when they are being called upon to serve 
abroad and here at home in the fight against terror, the Armed Forces 
Tax Fairness Act allows members of the National Guard to deduct up to 
$1,500 in travel, lodging, and meal expenses from their taxable income 
if they have to travel more than 100 miles to attend National Guard and 
reserve meetings.
  One of the most commonsense provisions of this bill recognizes that 
when a member of our military is deployed, poised for action but not 
yet in combat, they should not be preoccupied with meeting IRS 
deadlines. This bill suspends tax filing rules for service members 
participating in contingency operations. Currently, such a suspension 
is only made available to service members in combat.
  Other measures in the bill salute past and future service members. 
One provision ensures that veterans organizations will not lose their 
tax-exempt status when admitting ancestors and direct descendants of 
veterans as members, and another provision allows students attending 
any one of our military service academies to withdraw funds from 
education savings accounts and qualified tuition programs without 
having to pay any penalties.
  All these measures form a combined message and action of support to 
our troops at a critical time. I am proud to support the Armed Forces 
Tax Fairness Act and urge all my colleagues to do the same.

  Mr. MEEK of Florida. Mr. Speaker:
     It is the soldier, not the reporter, Who has given us freedom 
           of the press.
     It is the soldier, not the poet, Who has given us freedom of 
           speech.
     It is the soldier, not the organizer, Who has given us 
           freedom to demonstrate.
     It is the soldier, Who Salutes the flag, Who serves beneath 
           the flag,
     And whose coffin is draped by the flag, Who allows the 
           protestor to burn the flag.''

                                           --[Charles M. Province]

  I open my remarks with this quote by Charles M. Province by thanking 
those men and women who continue to serve in the United States military 
and provide us with the freedoms that we so frequently take for 
granted. We don't all have to agree about the conditions and terms and 
politics of war to agree that we have men and women in uniform who are 
among the finest human beings on this planet. It is fitting that at a 
time when our thoughts and prayers are most strongly focused on them, 
that we in the 108th Congress have this opportunity to offer them this 
small showing of our commitment to them.
  According to the U.S. Department of Defense, more than 188,000 
members of the National Guard and Reserve are currently mobilized for 
active duty on top of the many hundreds of thousands of career active 
duty soldiers. These friends, neighbors, and family members are putting 
their everyday lives on hold in order to protect us and provide us with 
more than a sense, but a knowledge of security.
  Our military personnel and their families make enough sacrifices. 
They should not have to further sacrifice tax fairness just because 
they wear a uniform of the armed services. We need to provide 
incentives for our military personnel to continue their service to our 
country. Moreover, we need to provide adequate and fair compensation 
for our military personnel by ensuring that those men and women are 
treated fairly and equally under the provisions of the Internal Revenue 
Code.
  I think this bill does just that.
  This bill:
  Exempts payment to beneficiary of soldiers killed in the line of 
duty;
  Extends the income tax deadline for soldiers deployed overseas for 
potential action;
  Makes it easier for transferred soldiers to be exempted from capital 
gains taxes on the sale of their homes; and,
  Would provide guardsmen and reservist an above-the-line deduction for 
unreimbursed travel expenses incurred by members of the reserve 
components, while going to and from training.
  These are simply issues of fairness. The Floridians and other fine 
Americans that take the stand to fight for our country deserve every 
fair consideration under our tax laws. The Tax Code is complicated 
enough, and our military should not be penalized for making decisions 
required because their official assignments. By passing this 
legislation, we are helping the members of our armed forces so that 
they will no longer be burdened by out-of-date tax regulations that 
penalize them even as they are serving our country.
  Finally, I'd like to congratulate leadership for bringing this good 
bill to the floor clean so that we can focus on an issue on which 
Republicans and Democrats all agree--equity and fairness for members of 
the uniformed services.
  Everyday, both in peacetime and in wartime, the brave men and women 
of our military work to preserve our freedoms. With this small token, I 
hope we can preserve some of theirs. I urge the support of this good 
bill.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise today to express my 
support of H.R. 878, the Armed Forces Tax Fairness Act of 2003. It has 
been long overdue that we provide real relief to the men and women who 
serve in our Armed Forces. Many of the members of the military are 
minorities, and this bill will help many in my own 18th Congressional 
District in Houston. More than 200,000 troops are now being employed to 
the Persian Gulf. In Houston, many soldiers will be called upon to 
serve on the front lines.
  This legislation provides tax relief to the members of our military. 
Our soldiers are on the frontlines every day, and now as a war with 
Iraq looms, we are calling upon these men and women to make even 
greater sacrifices. While I support this legislation, I wanted the bill 
to focus solely on tax benefits for military personnel and not to be 
used as a vehicle for special interest tax breaks.
  Studies have shown pay rates in the military consistently lag behind 
comparable jobs in the private sector. I believe that this legislation 
would help military families as they struggle like so many to pay basic 
expenses.
  The provisions in this legislation would provide tax breaks on home 
sales, travel expenses, and death benefits. We have ample tax benefits 
for corporations, it is time to help our officers and enlisted soldiers 
in the Armed Forces.
  Now more than ever, it's important to support America's top-notch 
Armed Forces. I've always believed that in order for Americans to enjoy 
the freedom that characterizes our country, and for Texans to be able 
to fully enjoy the natural beauty and resources of our State, it is 
crucial for the citizens of the Nation and our State to feel safe.
  To achieve this goal, it's vital that we keep America's Armed Forces 
strong. Throughout the years, I've fought for funding to constantly 
improve the quality of defense-related activities in my State of Texas.
  The importance of national defense is increasing every day, and I 
will continue to support our Armed Forces--they are the young men and 
women on the front lines who are called to sacrifice for this great 
Nation and to preserve our constitutional protections and liberties.
  I urge my colleagues to support this bill.
  Mr. BEREUTER. Mr. Speaker, this Member rises in strong support of 
H.R. 1307, the Armed Forces Tax Fairness Act of 2003, as it relates to 
the members of our armed services--active duty, reserve components, and 
National Guard personnel serving on active duty. Indeed, this Member 
would like to commend the Ways and Means Committee Chairman, the 
distinguished gentleman from California (Mr. Thomas), for his efforts 
to craft this very timely legislation which will assist our military 
personnel.
  Across the U.S., men and women serving in active, Reserve, and 
National Guard units are mobilizing and deploying. Whether for missions 
at the Nebraska Air National Guard base in Lincoln, in Bosnia, in the 
Middle East, or elsewhere, these mobilizations and deployments have an 
immediate impact on families, employers, and communities. Indeed, 
deployments separate families which have young children. Moms and dads 
spend their children's birthdays overseas. Husbands and

[[Page 6543]]

wives miss spending anniversaries together. Men and women leave their 
places of employment and also their paychecks as they mobilize. In this 
Member's home state of Nebraska, already 35 percent of the National 
Guard personnel have been mobilized for active duty.
  Today, this body has the opportunity to send these men and women a 
very much deserved ``thank you'' for their personal and financial 
sacrifices by adjusting the tax code to reflect the realities which 
military personnel and their families face, such as frequent moves and 
increased child care costs associated with deployments.
  The Armed Forces Tax Fairness Act of 2003 is a diverse bill; first 
and foremost it would provide assistance to men and women serving on 
military frontlines. For example, H.R. 1307 would amend the Internal 
Revenue Code to allow military personnel, who are transferred, to 
utilize the capital gains tax relief on the sale of their home by 
suspending the running of the present law 5-year rule for a total of 5 
years during the time they are assigned away from home. The 5-year rule 
provides that an individual is not subject to the capital gains taxes 
for the first $250,000, or for a couple, the first $500,000 on a joint 
return on the sale of a home if it has been the principal residence for 
2 out of the last 5 years. Because military personnel move frequently, 
they often do not meet the residence requirement. This legislation 
would suspend the residence requirement when the military personnel are 
stationed 250 miles from their primary house.
  Additionally, H.R. 1307 would allow National Guard members to take an 
above-the-line deduction of overnight travel expenses associated with 
their service. This is particularly important for, as an example, 
Nebraska's National Guard members frequently must travel extensive 
distances to participate in Guard training and drills.
  Other provisions within the legislation would clarify how certain 
child care expenses shall be treated and would exempt military death 
gratuity payments from taxes. (Currently, survivors of military 
personnel receive $6,000 of which $3,000 is taxable.)
  Mr. Speaker, this Member strongly urges his colleagues to vote for 
H.R. 1307 for at least the tax changes aforementioned are quite 
appropriate.
  Mr. THOMAS. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Linder). The question is on the motion 
offered by the gentleman from California (Mr. Thomas) that the House 
suspend the rules and pass the bill, H.R. 1307.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. THOMAS. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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