(Sec. 102) Provides a business-related tax credit ($30,000 annual maximum) for qualifying employee reserve forces participation, equaling the sum of: (1) the employment credit of all qualified employees of the taxpayer; and (2) the self-employment credit of a qualified self-employed taxpayer.
(Sec. 103) Deems the expenses of a reserve component member as away from home in pursuit of a trade or business during any time that such person is away from home on reserve service. Allows such expense for itemizers and non-itemizers. Exempts reserve member expenses from entertainment expense disallowance and partial meal and entertainment limitation.
Title II: Additional Benefits for Reserves of the Armed Forces - Reserve Components Equity Act of 2000 - Amends Federal law to authorize armed forces reserve and National Guard personnel traveling to perform annual training duty outside the continental United States to travel on a space-required basis between the member's home and place of duty if there is no available road or rail transportation.
Directs the Secretary of Defense to prescribe regulations to provide the following persons with transportation on Department of Defense (DOD) aircraft on a space-available basis under the same terms and conditions that apply to members of the armed forces entitled to retired pay: (1) members of the Selected Reserve in good standing; (2) a former reserve member under 60 years of age who would be eligible for retired pay except for being under such age; and (3) dependents of the above. Limits the required identification for such travel.
Directs the Secretary to prescribe regulations authorizing a reserve member traveling to inactive duty training at least 50 miles from home to be eligible for billeting (housing) in DOD facilities on the same basis as active-duty personnel traveling under orders away from such member's duty station. Requires proof of the reason for such travel.
Increases the maximum number of reserve retirement points that may be credited in a year for reserve service.
Authorizes the Secretary of the military department concerned to provide civil legal services to reserve personnel (and their dependents) not otherwise entitled to such services following a release from active duty under a call or order to such duty for more than 30 days under a mobilization authority, but only for a period that is not in excess of twice the length of the duty period served.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2230 Introduced in Senate (IS)]
106th CONGRESS
2d Session
S. 2230
To provide tax relief in relation to, and modify the treatment of,
members of a reserve component of the Armed Forces, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 9, 2000
Mr. Grams introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To provide tax relief in relation to, and modify the treatment of,
members of a reserve component of the Armed Forces, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Military Guard and Reserve Fairness
Act of 2000''.
TITLE I--TAX BENEFITS FOR RESERVES OF THE ARMED FORCES
SEC. 101. INCOME EXCLUSION FOR PAY OF CERTAIN RESERVISTS DEPLOYED
OVERSEAS.
(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to items specifically excluded
from gross income) is amended by inserting after section 112 the
following new section:
``SEC. 113. CERTAIN COMPENSATION OF MEMBERS OF RESERVE COMPONENT.
``(a) Enlisted Members.--Gross income does not include compensation
received for active service as a member below the grade of commissioned
officer in a reserve component of the Armed Forces of the United States
by reason of such member's active duty performed, as designated in the
member's military orders, in support of a contingency operation (as
defined in section 101(a)(13) of title 10, United States Code) while
deployed outside the United States.
``(b) Commissioned Officer.--Gross income does not include so much
of the compensation as does not exceed the maximum enlisted amount
received for active service as a commissioned officer in a reserve
component of the Armed Forces of the United States by reason of such
officer's active duty performed, as designated in the officer's
military orders, in support of a contingency operation (as so defined)
while deployed outside the United States.
``(c) Definitions.--For purposes of this section--
``(1) In general.--Any terms used in this section have the
meaning given such terms in section 112(c).
``(2) Deployed.--The term `deployed' means that a member is
performing services in a training exercise or operation at a
location or under circumstances that make it impossible for the
member to spend off-duty time at the member's official home of
record.
``(3) United states.--The term `United States' includes the
District of Columbia, American Samoa, the Federated States of
Micronesia, Guam, the Republic of the Marshall Islands, the
Commonwealth of the Northern Mariana Islands, the Commonwealth
of Puerto Rico, the Republic of Palau, and the United States
Virgin Islands.''.
(b) Definition of Reserve Component.--Section 7701(a) of the
Internal Revenue Code of 1986 (relating to definitions) is amended by
adding at the end the following new paragraph:
``(47) Reserve component of the armed forces of the united
states.--The term `reserve component of the Armed Forces of the
United States' means a reserve component described in section
10101 of title 10, United States Code.''.
(c) Conforming Amendment.--The table of sections for part III of
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is
amended by inserting after the item relating to section 112 the
following new item:
``Sec. 113. Certain compensation of
members of reserve
components.''.
(d) Effective Date.--The amendments made by this section shall
apply to service in taxable years beginning after December 31, 2000.
SEC. 102. TAX CREDIT FOR RESERVE FORCES PARTICIPATION.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to business-related
credits) is amended by adding at the end the following new section:
``SEC. 45D. RESERVE FORCE PARTICIPATION CREDIT.
``(a) General Rule.--For purposes of section 38, the reserve force
participation credit determined under this section for the taxable year
is an amount equal to the sum of--
``(1) the employment credit with respect to all qualified
employees of the taxpayer, plus
``(2) the self-employment credit of a qualified self-
employed taxpayer.
``(b) Limitation on Maximum Credit.--The credit allowed under
subsection (a) with respect to a taxpayer for the taxable year shall
not exceed $30,000.
``(c) Employment Credit.--For purposes of this section--
``(1) In general.--The employment credit with respect to a
qualified employee of the taxpayer for any taxable year is
equal to 50 percent of the amount of qualified compensation
that the taxpayer would have paid to the employee during the
taxable year had the employee not been participating in
qualified reserve duty, but only with respect to periods during
which the employee participates in such duty to the exclusion
of normal employment duties.
``(2) Qualified compensation.--
``(A) In general.--The term `qualified
compensation' means compensation which is--
``(i) normally contingent on the employee's
presence for work and which would be deductible
from the taxpayer's gross income under section
162 if the employee were present and receiving
such compensation, and
``(ii) not characterized by the taxpayer as
vacation or holiday pay, or as sick leave or
pay, or as any other form of pay for a
nonspecific leave of absence, and the receipt
of which does not result in any reduction in
the amount of vacation time, sick leave, or
other nonspecific leave previously credited to
or earned by the employee with respect to the
number of days covered by such compensation.
``(B) Only first $2,000 per year taken into
account.--The amount of qualified compensation which
may be taken into account with respect to a qualified
employee shall not exceed $2,000 per year.
``(3) Qualified employee.--The term `qualified employee'
means a person who--
``(A) has been an employee of the taxpayer for the
21-day period immediately preceding the period during
which the employee participates in qualified reserve
duty, and
``(B) is a member of the Ready Reserve (as
described in section 10142 of title 10, United States
Code) of a reserve component of the Armed Forces of the
United States.
``(d) Self-Employment Credit.--
``(1) In general.--The self-employment credit of a
qualified self-employed taxpayer for any taxable year is 50
percent of an amount equal to--
``(A) the excess, if any, of--
``(i) the average daily self-employment
income of the self-employed taxpayer for the
taxable year, over
``(ii) the average daily military pay and
allowances received by the self-employed
taxpayer, while participating in qualified
reserve duty to the exclusion of the taxpayer's
normal self-employment duties, multiplied by
``(B) the number of days the taxpayer participates
in qualified reserve duty during the taxable year.
``(2) Average daily self-employment income; average daily
military pay and allowances.--For purposes of paragraph (1)--
``(A) Average daily self-employment income.--The
term `average daily self-employment income' means an
amount equal to--
``(i) the self-employment income (as
defined in section 1402(b)) of the taxpayer for
the taxable year, divided by
``(ii) a number equal to the excess, if
any, of--
``(I) 365, over
``(II) the number of days the
taxpayer participates in qualified
reserve duty during the taxable year.
``(B) Average daily military pay and allowances.--
The term `average daily military pay and allowances'
means an amount equal to--
``(i) the amount received by the taxpayer
during the taxable year as military pay and
allowances in relation to the taxpayer's
participation in qualified reserve duty,
divided by
``(ii) the total number of days the
taxpayer participates in qualified reserve duty
during the taxable year.
``(3) Qualified self-employed taxpayer.--The term
`qualified self-employed taxpayer' means a taxpayer who--
``(A) has net earnings from self-employment (as
defined in section 1402) for the taxable year, and
``(B) is a member of the Ready Reserve (as so
described) of a reserve component of the Armed Forces
of the United States.
``(e) Credit in Addition to Deduction.--The employment credit
allowed under this section with respect to a taxpayer shall be in
addition to any other deduction allowable with respect to compensation
paid to a qualified employee during any period the employee
participates in qualified reserve duty to the exclusion of normal
employment duties.
``(f) Other Definitions.--For purposes of this section--
``(1) Military pay.--The term `military pay' has the same
meaning as the term `pay' under section 101(21) of title 37,
United States Code.
``(2) Allowances.--The term `allowances' means the
allowances payable to a member of the Armed Forces of the
United States under chapter 7 of such title.
``(3) Qualified reserve duty.--The term `qualified reserve
duty', with respect to a Reserve who is a qualified employee or
qualified self-employed taxpayer, means active duty performed,
as designated in the Reserve's military orders, in support of a
contingency operation (as defined in section 101(a)(13) of
title 10, United States Code). Such term includes any period in
which the Reserve is in a travel status in connection with such
duty.
``(g) Special Rules.--
``(1) Treatment of employer.--All employers treated as a
single employer under subsection (a) or (b) of section 52 or
subsection (m) or (o) of section 414 shall be treated as a
single employer for purposes of this section.
``(2) Failure to comply with employment or reemployment
rights of members of the reserve components of the armed
forces.--No credit shall be allowed under subsection (a) with
respect to a taxpayer for any taxable year, and the 2 taxable
years immediately following such year, in which the taxpayer is
under a final order, judgment, or other process issued or
required by a district court of the United States under section
4323 of title 38, United States Code, with respect to a
violation of chapter 43 of such title.
``(3) Persons ordered to active duty for training.--An
individual shall not be treated as a qualified employee or
qualified self-employed taxpayer with respect to any period
during which the individual is called or ordered to active duty
for any portion of such period for any of the following types
of duty:
``(A) Active duty for training under any provision
of title 10, United States Code.
``(B) Training at encampments, maneuvers, outdoor
target practice, or other exercises under chapter 5 of
title 32, United States Code.
``(C) Full-time National Guard duty (as defined in
section 101(d)(5) of title 10, United States Code).
``(4) Normal employment and self-employment duties.--For
purposes of subsection (c)(1) or (d)(1), an individual shall be
deemed not to be participating in qualified reserve duty to the
exclusion of normal employment or self-employment duties with
respect to the entire period of qualified reserve duty if, for
any portion of such period, such individual engages in or
undertakes any substantial activity related to the normal
employment or self-employment duties of such individual, other
than activities engaged in or undertaken while such individual
is in an authorized leave status or other authorized absence
from military duties.
``(5) Certain rules to apply.--Rules similar to the rules
of subsections (c), (d), and (e) of section 52 shall apply for
purposes of this section.''.
(b) Conforming Amendment.--Section 38(b) of the Internal Revenue
Code of 1986 (relating to general business credit) is amended by
striking ``plus'' at the end of paragraph (11), by striking the period
at the end of paragraph (12) and inserting ``, plus'', and by adding at
the end the following new paragraph:
``(13) the reserve force participation credit determined
under section 45D(a).''.
(c) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after the item relating to section 45C the
following new item:
``Sec. 45D. Reserve force participation
credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.
SEC. 103. DEDUCTION OF CERTAIN EXPENSES OF RESERVISTS.
(a) Deduction Allowed.--Section 162 of the Internal Revenue Code of
1986 (relating to trade or business expenses) is amended by
redesignating subsection (p) as subsection (q) and inserting after
subsection (o) the following new subsection:
``(p) Treatment of Expenses of Members of Reserve Component of
Armed Forces of the United States.--For purposes of subsection (a), in
the case of an individual who performs services as a member of a
reserve component of the Armed Forces of the United States at any time
during the taxable year, such individual shall be deemed to be away
from home in the pursuit of a trade or business during any period for
which such individual is away from home in connection with such
service.''.
(b) Deduction Allowed Whether or Not Taxpayer Elects To Itemize.--
Section 62(a)(2) of the Internal Revenue Code of 1986 (relating to
certain trade and business deductions of employees) is amended by
adding at the end the following new subparagraph:
``(D) Certain expenses of members of reserve
components of the armed forces of the united states.--
The deduction allowed by section 162 paid or incurred
by the taxpayer in connection with the performance of
services by such taxpayer as a member of a reserve
component of the Armed Forces of the United States.''.
(c) Allowance of Deduction for Entertainment Expenses.--Subsection
(e) of section 274 of the Internal Revenue Code of 1986 (relating to
disallowance of certain entertainment, etc., expenses) is amended by
adding at the end the following new paragraph:
``(10) Expenses incurred by members of reserve components
of the armed forces of the united states.--Expenses paid or
incurred by a taxpayer in connection with the performance of
services by such taxpayer as a member of a reserve component of
the Armed Forces of the United States.''.
(d) Inapplicability of 50 Percent Ceiling on Deduction for Meal and
Entertainment Expenses.--Subparagraph (A) of section 274(n)(2) of the
Internal Revenue Code of 1986 (relating to exceptions) is amended by
striking ``or (9)'' and inserting ``(9), or (10)''.
(e) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred in taxable years beginning after
December 31, 2000.
TITLE II--ADDITIONAL BENEFITS FOR RESERVES OF THE ARMED FORCES
SEC. 201. SHORT TITLE.
This title may be cited as the ``Reserve Components Equity Act of
2000''.
SEC. 202. TRAVEL BY RESERVES ON MILITARY AIRCRAFT OUTSIDE CONTINENTAL
UNITED STATES.
(a) Space-Required Travel for Travel to Duty Stations OCONUS.--(1)
Subsection (a) of section 18505 of title 10, United States Code, is
amended--
(A) by inserting ``annual training duty or'' before
``inactive-duty training'' both places it appears; and
(B) by inserting ``duty or'' before ``training if''.
(2) The heading of such section is amended to read as follows:
``Sec. 18505. Space-required travel: Reserves traveling to annual
training duty or inactive-duty training OCONUS''
(b) Space-Available Travel for Members of Selected Reserve and Gray
Area Retirees.--(1) Chapter 1805 of such title is amended by adding at
the end the following new section:
``Sec. 18506. Space-available travel: Selected Reserve members and
reserve retirees under age 60; dependents
``(a) Eligibility for Space-Available Travel.--The Secretary of
Defense shall prescribe regulations to provide persons described in
subsection (b) with transportation on aircraft of the Department of
Defense on a space-available basis under the same terms and conditions
(including terms and conditions applicable to travel outside the United
States) as apply to members and former members of the armed forces
entitled to retired pay.
``(b) Eligible Persons.--Subsection (a) applies to the following
persons:
``(1) A person who is a member of the Selected Reserve in
good standing (as determined by the Secretary concerned).
``(2) A person who is a member or former member of a
reserve component under age 60 who, but for age, would be
entitled to retired pay under chapter 1223 of this title.
``(c) Dependents.--A dependent of a person described in subsection
(b) shall be provided transportation under this section on the same
basis as dependents of members and former members of the armed forces
entitled to retired pay.
``(d) Limitation on Required Identification.--Neither the
`Authentication of Reserve Status for Travel Eligibility' form (DD Form
1853) nor any other form, other military identification and duty orders
or other forms of identification required of active duty personnel, may
be required to be presented by persons requesting space-available
transportation within or outside the continental United States under
this section.
``(e) Dependent Defined.--In this section, the term `dependent' has
the meanings given that term in subparagraphs (A), (B), (C), (D), and
(I) of section 1074(2) of this title.''.
(2) The table of sections at the beginning of such chapter is
amended by striking the item relating to section 18505 and inserting
the following:
``18505. Space-required travel: Reserves traveling to annual training
duty or inactive-duty training OCONUS.
``18506. Space-available travel: Selected Reserve members and reserve
retirees under age 60; dependents.''.
(c) Effective Date.--The regulations required under section 18506
of title 10, United States Code, as added by subsection (b), shall be
prescribed not later than 180 days after the date of the enactment of
this Act.
SEC. 203. BILLETING SERVICES FOR RESERVE MEMBERS TRAVELING FOR INACTIVE
DUTY TRAINING.
(a) In General.--(1) Chapter 1217 of title 10, United States Code,
is amended by inserting after section 12603 the following new section:
``Sec. 12604. Billeting in Department of Defense facilities: Reserves
attending inactive-duty training
``(a) Authority for Billeting on Same Basis as Active Duty Members
Traveling Under Orders.--The Secretary of Defense shall prescribe
regulations authorizing a Reserve traveling to inactive-duty training
at a location more than 50 miles from that Reserve's residence to be
eligible for billeting in Department of Defense facilities on the same
basis and to the same extent as a member of the armed forces on active
duty who is traveling under orders away from the member's permanent
duty station.
``(b) Proof of Reason for Travel.--The Secretary shall include in
the regulations the means for confirming a Reserve's eligibility for
billeting under subsection (a).''.
(2) The table of sections at the beginning of such chapter is
amended by inserting after the item relating to section 12603 the
following new item:
``12604. Billeting in Department of Defense facilities: Reserves
attending inactive-duty training.
(b) Effective Date.--Section 12604 of title 10, United States Code,
as added by subsection (a), shall apply with respect to periods of
inactive-duty training beginning more than 180 days after the date of
the enactment of this Act.
SEC. 204. ELIMINATION OF CAP ON MAXIMUM RESERVE RETIREMENT POINTS THAT
MAY BE CREDITED IN ANY YEAR.
Section 12733(3) of title 10, United States Code, is amended by
striking ``but not more than'' and all that follows and inserting ``but
not more than--
``(A) 60 days in any one year of service before the
year of service that includes September 23, 1996; and
``(B) 75 days in the year of service that includes
September 23, 1996, and in any subsequent year of
service before the year of service that includes the
date of the enactment of the Reserve Components Equity
Act of 2000.''.
SEC. 205. AUTHORITY FOR PROVISION OF LEGAL SERVICES TO RESERVE
COMPONENT MEMBERS FOLLOWING RELEASE FROM ACTIVE DUTY.
(a) Legal Services.--Section 1044(a) of title 10, United States
Code, is amended--
(1) by redesignating paragraph (4) as paragraph (5); and
(2) by inserting after paragraph (3) the following new
paragraph (4):
``(4) Members of reserve components of the armed forces not
covered by paragraph (1) or (2) following release from active
duty under a call or order to active duty for more than 30 days
issued under a mobilization authority (as determined by the
Secretary of Defense), but only during the period that begins
on the date of the release and is equal to twice the length of
the period served on active duty under such call or order to
active duty.''.
(b) Dependents.--Paragraph (5) of such section, as redesignated by
subsection (a)(1), is amended by striking ``and (3)'' and inserting
``(3), and (4)''.
(c) Implementing Regulations.--Regulations to implement the
amendments made by this section shall be prescribed not later than 180
days after the date of the enactment of this Act.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S1399-1400)
Read twice and referred to the Committee on Finance.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line