A bill to provide enhanced education and employment opportunities for military spouses.

Summary: Military Spouse Education and Employment Act of 2008 - Amends the Internal Revenue Code to include spouses of members of the Armed Forces on extended active duty (more than 90 days or for an indefinite period) and eligible teleworking military spouses (teleworking spouses whose wages are expected to equal or exceed 150% of U.S. median annual earnings) as members of a targeted group for purposes of the work opportunity tax credit.

Includes the wife or husband of a member serving on extended active duty within the federal veterans' employment preference.

Allows members who have completed two terms of service and have reenlisted for a third term to transfer a portion of their entitlement to basic educational assistance under the Montgomery GI Bill. (Current law allows such transfer for members with critical military skills.)

Requires studies on: (1) the development of an education grant program for training military spouses in health care and early childhood development careers; and (2) creating work opportunities for undergraduate- and graduate-educated military spouses during the active-duty service of their spouses.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Military Spouse Education and 
Employment Act of 2008''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Congressional defense committees.--The term 
        ``congressional defense committees'' means--
                    (A) the Committee on Armed Services and the 
                Committee on Appropriations of the Senate; and
                    (B) the Committee on Armed Services and the 
                Committee on Appropriations of the House of 
                Representatives.
            (2) Qualified military spouse.--The term ``qualified 
        military spouse'' means a spouse of a member of the Armed 
        Forces of the United States who is serving on a period of 
        extended active duty which includes the hiring date. For 
        purposes of the preceding sentence, the term ``extended active 
        duty'' means any period of active duty pursuant to a call or 
        order to such duty for a period in excess of 90 days or for an 
        indefinite period.

SEC. 3. ELIGIBILITY OF SPOUSES OF MILITARY PERSONNEL FOR THE WORK 
              OPPORTUNITY CREDIT.

    (a) In General.--Paragraph (1) of section 51(d) of the Internal 
Revenue Code of 1986 is amended by striking ``or'' at the end of 
subparagraph (H), by striking the period at the end of subparagraph (I) 
and inserting ``, or'', and by adding at the end the following new 
subparagraph:
                    ``(J) either--
                            ``(i) a qualified military spouse (as 
                        defined in subsection (l)(1)), or
                            ``(ii) subject to subsection (l)(2), an 
                        eligible teleworking military spouse.''.
    (b) Definitions and Rules Relating to Qualified Military Spouses.--
Section 51 of such Code is amended by adding at the end the following 
new subsection:
    ``(l) Definition of Qualified Military Spouse; Enhanced Credit for 
Eligible Teleworking Military Spouses.--For purposes of this section--
            ``(1) Definition of qualified military spouse.--For 
        purposes of subsection (d)(1)(J), the term `qualified military 
        spouse' means any individual (other than an eligible 
        teleworking military spouse) who is certified by the designated 
        local agency as being a spouse (determined as of the hiring 
        date) of a member of the Armed Forces of the United States who 
        is serving on a period of extended active duty which includes 
        the hiring date. For purposes of the preceding sentence, the 
        term `extended active duty' means any period of active duty 
        pursuant to a call or order to such duty for a period in excess 
        of 90 days or for an indefinite period.
            ``(2) Enhanced credit for eligible teleworking military 
        spouses.--
                    ``(A) In general.--Notwithstanding subsection (a), 
                in the case of an employer with respect to whom an 
                individual is an eligible teleworking military spouse 
                by reason of employment with such employer described in 
                subparagraph (B), the credit determined under this 
                section--
                            ``(i) shall be allowable for any taxable 
                        year which includes any portion of the 
                        eligibility period with respect to the spouse, 
                        and
                            ``(ii) shall, with respect to any such 
                        taxable year, be equal to 40 percent of the 
                        qualified wages paid by the employer with 
                        respect to such employment occurring during 
                        such portion of the eligibility period.
                    ``(B) Eligible teleworking military spouse.--For 
                purposes of subsection (d)(1)(J) and this paragraph, 
                the term `eligible teleworking military spouse' means, 
                with respect to any employer, an individual--
                            ``(i) who is certified by the designated 
                        local agency as being a spouse (determined as 
                        of the hiring date) of a member of a regular 
                        component of the Armed Forces of the United 
                        States,
                            ``(ii) substantially all of whose 
                        employment with the employer is reasonably 
                        expected to consist of services performed at 
                        the principal residence (within the meaning of 
                        section 121) of the individual, and
                            ``(iii) whose qualified wages (expressed as 
                        an annual amount) for services performed for 
                        the employer are reasonably expected to equal 
                        or exceed an amount equal to 150 percent of the 
                        median annual earnings for the United States 
                        (determined on the basis of the most recent 
                        occupational employment survey published by the 
                        Bureau of Labor Statistics before the calendar 
                        year in which the taxable year begins).
                    ``(C) Eligibility period.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `eligibility 
                        period' means, with respect to any individual 
                        who is an eligible teleworking military spouse, 
                        the period--
                                    ``(I) beginning on the hiring date 
                                of the individual, and
                                    ``(II) except as provided in clause 
                                (ii), ending on the earlier of the last 
                                day of the employment described in 
                                subparagraph (B) or the last day of the 
                                taxable year in which occurs the date 
                                on which the individual's spouse ceases 
                                to be a member of a regular component 
                                of the Armed Forces of the United 
                                States.
                            ``(ii) Failure to meet employment and wage 
                        requirements.--If the requirements of clauses 
                        (ii) and (iii) of subparagraph (B) are not met 
                        with respect to any individual for any taxable 
                        year--
                                    ``(I) the individual shall cease to 
                                be an eligible teleworking military 
                                spouse with respect to the employer as 
                                of the beginning of the taxable year, 
                                and
                                    ``(II) the employer shall not treat 
                                the individual as an eligible 
                                teleworking military spouse for any 
                                subsequent taxable year.
                        This clause shall not apply to any failure 
                        which is due to unforeseen circumstances or is 
                        beyond the control of the employer.
                    ``(D) Qualified wages.--The term `qualified wages' 
                has the meaning given such term by subsection (b)(1), 
                except that the amount of wages which may be taken into 
                account with respect to any eligible teleworking 
                military spouse for any taxable year shall not exceed 
                $12,000.''.
    (c) Effective Date.--The amendments made this section shall apply 
to amounts paid or incurred after the date of the enactment of this Act 
to individuals who begin work for the employer after such date.

SEC. 4. FEDERAL EMPLOYMENT PREFERENCES.

    (a) Eligibility of Military Spouses for Preference.--Section 
2108(3) of title 5, United States Code, is amended--
            (1) in subparagraph (F)(iii), by striking ``; and'' and 
        inserting a semicolon;
            (2) in subparagraph (G)(iii), by striking the semicolon at 
        the end and inserting ``; and''; and
            (3) by inserting after subparagraph (G) the following new 
        subparagraph:
                    ``(H) the wife or husband of an individual serving 
                on active duty or with orders to report for a period of 
                active duty in excess of 90 days or for an indefinite 
                period;''.
    (b) Eligibility for Additional Points Above Earned Rating on 
Competitive Service Examinations.--Section 3309(2) of such title is 
amended to read as follows:
            ``(2) a preference eligible under subparagraphs (A), (B), 
        or (H) of section 2108(3) of this title--5 points.''.

SEC. 5. TRANSFERABILITY OF ENTITLEMENT TO BASIC EDUCATIONAL ASSISTANCE.

    (a) Transferability as Incentive To Reenlist for Third Term of 
Service.--Section 3020 of title 38, United States Code, is amended--
            (1) in the heading, by striking ``: members of the Armed 
        Forces with critical military skills'' and inserting ``: 
        members of the Armed Forces who reenlist for a third term'';
            (2) in subsection (a), by striking ``with critical military 
        skills'' and inserting ``who have completed two terms of 
        service and reenlisted for a third term,'';
            (3) in subsection (b), by striking ``section--'' and all 
        that follows through the period at the end and inserting 
        ``section, has completed two terms of service in the Armed 
        Forces and enters into an agreement for a third term.'';
            (4) in subsection (g)--
                    (A) in paragraph (1), by striking ``six years of 
                service'' and inserting ``two terms of service''; and
                    (B) in paragraph (2), by striking ``10 years of 
                service'' and inserting ``two terms of service''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 30 of such title is amended by amending the item relating to 
section 3020 to read as follows:

``3020. Transfer of entitlement to basic educational assistance: 
                            members of the Armed Forces who reenlist 
                            for a third term.''.

SEC. 6. STUDY ON DEVELOPMENT OF EDUCATION GRANT PROGRAM FOR TRAINING 
              MILITARY SPOUSES IN HEALTH CARE AND EARLY CHILDHOOD 
              DEVELOPMENT.

    (a) Study.--The Deputy Under Secretary of Defense for Military 
Community and Family Policy, in conjunction with the Assistant 
Secretary of Defense for Health Affairs, shall conduct a study on 
options for developing an education grant program to train military 
spouses in the health care and early childhood development careers, 
including the likelihood that such training could significantly 
increase private employment opportunities in the vicinity of active 
duty military installations.
    (b) Report.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary of Defense, in consultation with 
the Deputy Under Secretary of Defense for Military Community and Family 
Policy and the Assistant Secretary of Defense for Health Affairs, shall 
submit to the congressional defense committees a report on the study 
conducted under subsection (a).

SEC. 7. STUDY ON CREATING WORK OPPORTUNITIES FOR UNDERGRADUATE AND 
              GRADUATE LEVEL EDUCATED MILITARY SPOUSES.

    (a) Study.--The Under Secretary of Defense for Personnel and 
Readiness, in conjunction with the Deputy Under Secretary of Defense 
for Military Community and Family Policy, shall conduct a study of the 
challenges that face qualified military spouses who possess an 
undergraduate or graduate level education in finding and maintaining 
employment during the terms of service of their active duty spouses.
    (b) Report.--
            (1) In general.--Not later than 180 days after the date of 
        the enactment of this Act, the Secretary of Defense, in 
        consultation with the Under Secretary of Defense for Personnel 
        and Readiness, shall submit to the congressional committees a 
        report on the study conducted under subsection (a).
            (2) Elements.--The report required under paragraph (1) 
        shall include the following elements:
                    (A) A description of the major challenges that face 
                qualified military spouses who posses an undergraduate 
                or graduate level education in finding and maintaining 
                employment during the terms of service of their 
                spouses.
                    (B) A listing of significant incentive programs the 
                Department of Defense could utilize to create 
                incentives for the hiring of undergraduate and graduate 
                level qualified military spouses, including those the 
                Department can implement independently and those that 
                require statutory changes.
                    (C) A description of the resources available to 
                qualified military spouses with graduate and 
                undergraduate educations for assistance in finding and 
                maintaining employment.
                    (D) An examination of the retention implications of 
                insufficient employment opportunities for qualified 
                military spouses with undergraduate or graduate level 
                educations.
                    (E) A description of current programs to assist 
                qualified military spouses with undergraduate and 
                graduate level educations in securing telecommuting and 
                home office employment.