Guardsmen and Reservists Financial Relief Act of 2004 - Amends the Internal Revenue Code to exempt from the ten percent penalty on premature distributions from tax-exempt retirement plans, distributions to military reservists or national guardsmen ordered or called to active duty for a period in excess of 179 days or for an indefinite period, if such distributions are made during the active duty period. Applies this exemption to individuals ordered or called to active duty after September 11, 2001, and before September 12, 2005.
Applies withholding of tax requirements to differential wage payments. Defines "differential wage payments" as employer payments made to an employee on active duty in the Uniformed Services for more than 30 days representing all or a portion of the wages such employee would have received if performing services for the employer. Treats differential wage payments as compensation for retirement plan purposes.
Allows certain small business employers (having an average of 50 or fewer employees): (1) a general business tax credit for 50 percent of the lesser of actual compensation paid to each Ready Reserve-National Guard employee while on active duty or $30,000 (terminates such credit after 2005); and (2) a work opportunity tax credit for employees hired to replace Ready Reserve-National Guard employees while such employees are on active duty (disqualifies employers who fail to comply with employment or reemployment rights of military reservists).
Directs the Comptroller General to study and report to Congress before July 1, 2005, on: (1) problems in recruiting military reservists; (2) problems in providing differential wage payments to military reservists; and (3) the effectiveness of the Ready Reserve-National Guard employee tax credit as an incentive for the hiring and retention of military reservist employees.
Exempts a qualified disaster-relief distribution from the ten percent penalty on premature distributions from tax-exempt retirement plans. Defines "qualified disaster-relief distribution" as any distribution from a tax-exempt retirement plan to an individual who has sustained a loss in excess of $100 as a result of a major disaster declared under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Requires such distribution to be made during the one year period after the date of the disaster declaration.
[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1779 Introduced in House (IH)]
108th CONGRESS
1st Session
H. R. 1779
To amend the Internal Revenue Code of 1986 to allow penalty-free
withdrawals from retirement plans during the period that a military
reservist or national guardsman is called to active duty for an
extended period, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 11, 2003
Mr. Beauprez (for himself and Mr. Barrett of South Carolina) introduced
the following bill; which was referred to the Committee on Ways and
Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to allow penalty-free
withdrawals from retirement plans during the period that a military
reservist or national guardsman is called to active duty for an
extended period, 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 ``Guardsmen and Reservists Financial
Relief Act of 2003''.
SEC. 2. PENALTY-FREE WITHDRAWALS FROM RETIREMENT PLANS FOR INDIVIDUALS
CALLED TO ACTIVE DUTY FOR AT LEAST 179 DAYS.
(a) In General.--Paragraph (2) of section 72(t) of the Internal
Revenue Code of 1986 (relating to 10-percent additional tax on early
distributions from qualified retirement plans) is amended by adding at
the end the following new subparagraph:
``(G) Distributions from retirement plans to
individuals called to active duty.--
``(i) In general.--Any qualified reservist
distribution.
``(ii) Amount distributed may be repaid.--
Any individual who receives a qualified
reservist distribution may, at any time during
the 2-year period beginning on the day after
the end of the active duty period, make one or
more contributions to an individual retirement
plan of such individual in an aggregate amount
not to exceed the amount of such distribution.
The dollar limitations otherwise applicable to
contributions to individual retirement plans
shall not apply to any contribution made
pursuant to the preceding sentence. No
deduction shall be allowed for any contribution
pursuant to this clause.
``(iii) Qualified reservist distribution.--
For purposes of this subparagraph, the term
`qualified reservist distribution' means any
distribution to an individual if--
``(I) such distribution is from an
individual retirement plan, or from
amounts attributable to employer
contributions made pursuant to elective
deferrals described in subparagraph (A)
or (C) of section 402(g)(3) or section
501(c)(18)(D)(iii),
``(II) such individual was (by
reason of being a member of a reserve
component (as defined in section 101 of
title 37, United States Code)), ordered
or called to active duty for a period
in excess of 179 days or for an
indefinite period, and
``(III) such distribution is made
during the period beginning on the date
of such order or call and ending at the
close of the active duty period.
``(iv) Application of subparagraph.--This
subparagraph applies to individuals ordered or
called to active duty after September 11, 2001,
and before September 12, 2005. In no event
shall the 2-year period referred to in clause
(ii) end before the date which is 2-years after
the date of the enactment of this
subparagraph.''
(b) Conforming Amendments.--
(1) Section 401(k)(2)(B)(i) of such Code is amended by
striking ``or'' at the end of subclause (III), by striking
``and'' at the end of subclause (IV) and inserting ``or'', and
by inserting after subclause (IV) the following new subclause:
``(V) the date on which a period
referred to in section
72(t)(2)(G)(iii)(III) begins, and''.
(2) Section 403(b)(11) of such Code is amended by striking
``or'' at the end of subparagraph (A), by striking the period
at the end of subparagraph (B) and inserting ``, or'', and by
inserting after subparagraph (B) the following new
subparagraph:
``(C) for distributions to which section
72(t)(2)(G) applies.''
(c) Effective Date.--The amendment made by this section shall apply
to distributions after September 11, 2001.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Mr. Shaw moved to suspend the rules and pass the bill.
Considered under suspension of the rules. (consideration: CR H2217-2223)
DEBATE - The House proceeded with forty minutes of debate on H.R. 1779.
At the conclusion of debate, the Yeas and Nays were demanded and ordered. Pursuant to the provisions of clause 8, rule XX, the Chair announced that further proceedings on the motion would be postponed.
Considered as unfinished business. (consideration: CR H2226-2227)
Passed/agreed to in House: On motion to suspend the rules and pass the bill Agreed to by the Yeas and Nays: (2/3 required): 415 - 0 (Roll no. 125).(text: CR H2217-2218)
Roll Call #125 (House)On motion to suspend the rules and pass the bill Agreed to by the Yeas and Nays: (2/3 required): 415 - 0 (Roll no. 125). (text: CR H2217-2218)
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Motion to reconsider laid on the table Agreed to without objection.
Received in the Senate and Read twice and referred to the Committee on Finance.
Senate Committee on Finance discharged by Unanimous Consent.
Senate Committee on Finance discharged by Unanimous Consent.
Measure laid before Senate by unanimous consent. (consideration: CR S11222)
Passed/agreed to in Senate: Passed Senate with an amendment by Unanimous Consent.
Passed Senate with an amendment by Unanimous Consent.