[Congressional Record (Bound Edition), Volume 153 (2007), Part 27]
[Senate]
[Page 36419]
[From the U.S. Government Publishing Office, www.gpo.gov]




              DEFENDERS OF FREEDOM TAX RELIEF ACT OF 2007

  Mr. REID. Mr. President, I ask the Chair to lay before the Senate a 
message from the House with respect to H.r. 3997.
  The legislative clerk read as follows:

       Resolved, That the House agree to the amendments of the 
     Senate to the bill (H.R. 3997) entitled ``An Act to amend the 
     Internal Revenue Code of 1986 to provide earnings assistance 
     and tax relief to members of the uniformed services, 
     volunteer firefighters, and Peace Corps volunteers, and for 
     other purposes'', with an amendment.

  Mr. BAUCUS. Mr. President, as the Christmas season approaches, it is 
important to pause and reflect on the sacrifices that our men and women 
in uniform make for us every day.
  Fully 1.4 million American service men and women have served in Iraq, 
Afghanistan, or both. Nearly 30,000 troops have been wounded in action.
  In September, I took a trip to Iraq. I was so impressed by what an 
amazing job our troops are doing. I met many Montanans from small towns 
like Roundup and Townsend. Despite all of the hardships that they 
face--all the danger--they keep at it every day. I saw firsthand what a 
heavy burden our troops bear for all of us.
  Today, one small way to support them in their efforts is to make the 
Tax Code a little more troop-friendly. We can extend the special tax 
rules that make sense for our military that expire in 2007 and 2008. 
And we can eliminate roadblocks in the current tax laws that present 
difficulties to veterans and servicemembers.
  For example, family members of fallen soldiers killed in the line of 
duty receive a death gratuity benefit of $100,000, but the Tax Code 
restricts the survivors from contributing this benefit into a Roth IRA. 
Today we can make sure that the family members of fallen soldiers may 
take advantage of tax-favored accounts.
  Another hazard in the tax laws impeding our disabled veterans is the 
statute of limitations for filing a tax refund. Most VA disability 
claims filed by veterans are quickly resolved. But many disability 
awards are delayed due to lost paperwork or the appeals of rejected 
claims. Once a disabled vet finally gets a favorable award, the good 
news is that the disability award is tax-free. But the bad news is that 
many of these disabled veterans get ambushed by a statute that bars 
them from filing a tax refund claim. Today, we can give disabled 
veterans an extra year to claim their tax refunds.
  Most troops doing the heavy lifting in combat situations are the 
lower ranking, lower income bracket soldiers. Their income needs to 
count towards computing the earned income tax credit, or EITC. But the 
provision that makes EITC work for combat troops expires at the end of 
2007. The EITC is a very beneficial tax provision available to working 
Americans. And it makes no sense to deny it to our troops. Today we can 
make combat duty income count for EITC purposes and make this change to 
the Tax Code permanent.
  I should mention that these tax provisions are fully paid for. A 
change in the Tax Code makes sure that any individual relinquishing 
their U.S. citizenship is still on the hook to pay for their fair share 
of U.S. taxes.
  A soldier's rucksack is heavy enough as it is without loading it down 
with tax burdens. We owe the Americans fighting in our armed forces an 
enormous debt of gratitude.
  That's why today I am asking for these important tax reforms. They 
are one small way that we can salute our men and women in uniform for 
all they do.
  Also included in this package are a series of tax technical 
corrections. These noncontroversial provisions contain corrections to 
various tax acts from 1999, 2001, 2003, 2004, 2005 and 2006.
  These technical changes include clarifications on the contributions 
of fractional interests in tangible property, modification of the 
active business definition under section 355, timing of claims for 
excess alternative fuel, and the treatment of losses on positions in 
identified straddles.
  The technical corrections package also includes a number of clerical 
and conforming amendments, including amendments correcting 
typographical errors. This package makes sense and adds clarity to the 
code, which we desperately need as we head into the 2007 filing season.
  Mr. REID. Mr. President, I ask unanimous consent that the Senate 
concur in the House amendment to the Senate amendments with an 
amendment, which is at the desk, and that the amendment be agreed to, 
the motion to reconsider be laid upon the table, and that the previous 
order with respect to this bill remain in effect.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  The amendment (No. 3890) was agreed to.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')

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