108TH CONGRESS

1ST SESSION H. R. 3365

AN ACT

To amend title 10, United States Code, and the Internal Revenue Code of 1986 to increase the

death gratuity payable with respect to deceasedmembers of the Armed Forces and to excludesuch gratuity from gross income.

108TH CONGRESS

1ST SESSION H. R. 3365

AN ACT

To amend title 10, United States Code, and the Internal

Revenue Code of 1986 to increase the death gratuity

payable with respect to deceased members of the Armed

Forces and to exclude such gratuity from gross income.

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

2 This Act may be cited as the ‘‘Fallen Patriots Tax

3 Relief Act’’.

4 SEC. 2. FINDINGS.

5 The Congress finds the following:

6 (1) The tragic events of September 11, 2001,

7 and subsequent worldwide combat operations in the

8 Global War on Terrorism and in Operation Iraqi

9 Freedom have highlighted the significant contribu10 tions of members of the Armed Forces in support of

11 the national security of the United States and the

12 sacrifices made by those members in the defense of

13 freedom.

14 (2) The sacrifices made by the members of the

15 Armed Forces are significant and are worthy of

16 meaningful expressions of gratitude by the Govern17 ment of the United States, especially in the case of

18 sacrifice through loss of life.

19 (3) The death gratuity payment made by the

20 United States Government for deaths while in mili21 tary service has historically been tax exempt.

22 (4) The military death gratuity payment should

23 remain tax exempt in order to assist families of fall24 en patriots to continue their quality of life during

25 their greatest time of need.
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1 (5) The Congress should periodically increase

2 the amount of the military death gratuity payment

3 to ensure that its value is not diminished.

4 SEC. 3. INCREASE IN DEATH GRATUITY PAYABLE WITH RE5 SPECT TO DECEASED MEMBERS OF THE

6 ARMED FORCES.

7 (a) AMOUNT OF DEATH GRATUITY.—Section

8 1478(a) of title 10, United States Code, is amended by

9 striking ‘‘$6,000’’ and inserting ‘‘$12,000’’.

10 (b) EFFECTIVE DATE.—The amendment made by

11 subsection (a) shall take effect as of September 11, 2001,

12 and shall apply with respect to deaths occurring on or

13 after that date.

14 SEC. 4. RESTORATION OF FULL EXCLUSION FROM GROSS

15 INCOME OF DEATH GRATUITY PAYMENT.

16 (a) IN GENERAL.—Paragraph (3) of section 134(b)

17 of the Internal Revenue Code of 1986 (relating to quali18 fied military benefit) is amended by adding at the end the

19 following new subparagraph:

20 ‘‘(C) EXCEPTION FOR DEATH GRATUITY

21 ADJUSTMENTS MADE BY LAW.—Subparagraph

22 (A) shall not apply to any adjustment to the

23 amount of death gratuity payable under chapter

24 75 of title 10, United States Code, which is

25 pursuant to a provision of law enacted on or be-
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1 fore the date of the enactment of this subpara2 graph.’’.

3 (b) CONFORMING AMENDMENT.—Section

4 134(b)(3)(A) of such Code is amended by striking ‘‘sub5 paragraph (B)’’ and inserting ‘‘subparagraphs (B) and

6 (C)’’.

7 (c) EFFECTIVE DATE.—The amendments made by

8 this section shall apply with respect to deaths occurring

9 after September 10, 2001.

Passed the House of Representatives October 29,

2003.

Attest:

Clerk.