By PHIL GOBLE JR. Managing Editor
The Mt. Airy News May 24, 2005
North Carolina congresswoman Virginia Foxx (R) became the first freshman of the 109th Congress to have a policy-changing bill passed on Monday when the House passed HR 1499 on a voice vote.
The bill, called the Heroes Earned Retirement Opportunities (H.E.R.O.) Act, will change a section of the Internal Revenue Service code to allow soldiers serving in combat roles to contribute to an IRA with their combat pay, something they can not do now.
“It's both humbling and exhilarating,” Foxx said Monday afternoon in a telephone interview. “It's a humbling experience standing in the well of the House and advocating for your bill.
“You realize the responsibility that you have.”
The bill was co-sponsored by 47 members of the House of Representatives, including North Carolina representatives Patrick T. McHenry, Robin Hayes and Howard Coble.
Virginia representatives Eric Cantor and Virgil H. Goode Jr. also signed on as co-sponsors.
Foxx was amazed at the number of co-sponsors, especially since she had looked at “a number of very good bills” that did not have the same support.
“Everybody I've talked to about the bill said how fair it was and how common sense it was,” Foxx said.
The bills is not long, consisting of an introduction and just two sections.
The legislation, which was endorsed by the Reserve Officers Association and the Military Officers Association of America , would not tax the hazard pay, but make it eligible to be invested in IRAs.
“These wages are not taxed — nor should they be,” Foxx said in a letter to her fellow House members. “However, since this compensation is nontaxable, the wages are not eligible for IRA contributions. As we all know, IRAs are an excellent tool for responsible retirement savings. The men and women defending America in overseas war zones should not be excluded from fully participating in this important retirement investment opportunity because of a glitch in our tax code.”
Foxx began work on the bill after receiving a letter from the father of Army Specialist Michael Hensley from Clemmons.
“I am glad this constituent brought this problem to my attention,” Foxx said Monday afternoon after the bill's passage. “After contacting the IRS, I decided to do something to solve this problem. The best ideas always come from my constituents back home and that's why I spend so much time in the district. I'm pleased to be able to help this soldier and his comrades.”
The bill was introduced April 6 and sent to the House Ways and Means Committee.
Nebraska senator Kent Conrad introduced a similar bill in the Senate on March 10. His bill, S.601, has been read twice to the Committee on Finance.
Foxx said she will meet with North Carolina senators Elizabeth Dole and Richard Burr as well as Sen. Chuck Grassly (R-Iowa) to see what needs to be done to get the bill passed by the Senate.
“I look forward to working with members of the Senate to see that this makes it to the president's desk and is signed into law,” Foxx said in a press release about the bill.
HR 1499 IH
109th CONGRESS
1st Session
H. R. 1499 To amend the Internal Revenue Code of 1986 to allow a deduction to members of the Armed Forces serving in a combat zone for contributions to their individual retirement plans even if the compensation on which such contribution is based is excluded from gross income, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
April 6, 2005
Ms. FOXX introduced the following bill; which was referred to the Committee on Ways and Means
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A BILL
To amend the Internal Revenue Code of 1986 to allow a deduction to members of the Armed Forces serving in a combat zone for contributions to their individual retirement plans even if the compensation on which such contribution is based is excluded from gross income, 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 Heroes Earned Retirement Opportunities Act'.
SEC. 2. COMBAT ZONE COMPENSATION TAKEN INTO ACCOUNT FOR PURPOSES OF DETERMINING LIMITATION AND DEDUCTIBILITY OF CONTRIBUTIONS TO INDIVIDUAL RETIREMENT PLANS.
(a) In General — Subsection (b) of section 219 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: (6) SPECIAL RULE FOR COMPENSATION EARNED BY MEMBERS OF THE ARMED FORCES FOR SERVICE IN A COMBAT ZONE — For purposes of paragraph (1)(B), gross income shall be determined without regard to section 112.'. (b) Effective Date — The amendment made by this section shall apply to taxable years beginning after December 31, 2004.
