I 

108TH CONGRESS 

1ST SESSION H. R. 1518

To amend the Internal Revenue Code of 1986 to exclude from gross income 

any enlistment, accession, reenlistment, or retention bonus paid to a 

member of the Armed Forces. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 31, 2003

Mr. HOSTETTLER (for himself, Mr. BARTLETT of Maryland, Mr. MILLER of 

Florida, Mr. JONES of North Carolina, Mr. SCHROCK, Mr. GINGREY, Mr. 

TAYLOR of North Carolina, and Mr. BURGESS) 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 exclude 

from gross income any enlistment, accession, reenlistment, or retention bonus paid to a member of the Armed 

Forces.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. EXCLUSION FROM GROSS INCOME OF ENLIST4 MENT AND REENLISTMENT BONUSES FOR 

5 MEMBERS OF THE ARMED FORCES. 

6 (a) IN GENERAL.—Section 112 of the Internal Rev7 enue Code of 1986 (relating to certain combat zone com-
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1 pensation of members of the Armed Forces) is amended 

2 by redesignating subsections (c) and (d) as subsections (d) 

3 and (e), respectively, and by inserting after subsection (b) 

4 the following new subsection: 

5 ‘‘(c) QUALIFIED BONUS.—Gross income does not in6 clude a qualified bonus.’’. 

7 (b) QUALIFIED BONUS DEFINED.—Subsection (d) of 

8 section 112 of such Code (relating to definitions), as re9 designated by subsection (a), is amended by adding at the 

10 end the following new paragraph: 

11 ‘‘(6) QUALIFIED BONUS.—

12 ‘‘(A) IN GENERAL.—The term ‘qualified 

13 bonus’ means an enlistment, accession, reenlist14 ment, retention, or other bonus paid by the Sec15 retary concerned to a member of the Armed 

16 Forces of the United States in exchange for the 

17 agreement of the member to accept a commis18 sion as an officer, extend an active service com19 mitment as an officer, enlist, reenlist, or extend 

20 an enlistment as an enlisted member in an ac21 tive or reserve component, or enter into a re22 serve affiliation agreement. 

23 ‘‘(B) OTHER DEFINITIONS.—For purposes 

24 of subparagraph (A), the terms ‘active service’, 

25 ‘enlisted member’, ‘officer’, and ‘Secretary con-
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1 cerned’ have the meanings given to such terms 

2 in section 101 of title 10, United States Code.’’. 

3 (c) CONFORMING AMENDMENTS.—

4 (1) Section 2201 of such Code is amended by 

5 striking ‘‘section 112(c)’’ both places it appears and 

6 inserting ‘‘section 112(d)’’. 

7 (2) The heading for section 112 of such Code 

8 is amended by inserting ‘‘AND OTHER’’ before 

9 ‘‘COMPENSATION’’. 

10 (3) Section 3401(a)(1) of such Code is amended 

11 by inserting ‘‘and other’’ before ‘‘compensation’’. 

12 (4) The table of sections for part III of sub13 chapter B of chapter 1 of such Code is amended by 

14 striking the item relating to section 112 and insert15 ing the following new item:

‘‘Sec. 112. Certain combat zone and other compensation of members of the Armed Forces.’’.

16 (d) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply to taxable years beginning after 

18 December 31, 2002.

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