I

104TH CONGRESS

1ST SESSION H. R. 1402

To amend the Internal Revenue Code of 1986 to improve revenue collection

and to provide that a taxpayer conscientiously opposed to participation

in war may elect to have such taxpayer’s income, estate, or gift tax

payments spent for nonmilitary purposes, to create the United States

Peace Tax Fund to receive such tax payments, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

APRIL 5, 1995

Mr. JACOBS (for himself, Mr. LEACH, Mr. DELLUMS, Mr. FRANK of Massachusetts, Mrs. SCHROEDER, Mr. DEFAZIO, Mr. MILLER of California,

Ms. RIVERS, Mr. TOWNS, Mr. MARKEY, Mr. OBERSTAR, Ms. VELA ́ZQUEZ,

Mr. YATES, Ms. FURSE, Mr. LEWIS of Georgia, and Mr. MCHALE) introduced the following bill; which was referred to the Committee on Ways

and Means, and in addition to the Committees on International Relations,

and Economic and Educational Opportunities, for a period to be subsequently determined by the Speaker, in each case for consideration of such

provisions as fall within the jurisdiction of the committee concerned

A BILL

To amend the Internal Revenue Code of 1986 to improve

revenue collection and to provide that a taxpayer conscientiously opposed to participation in war may elect

to have such taxpayer’s income, estate, or gift tax payments spent for nonmilitary purposes, to create the

United States Peace Tax Fund to receive such tax payments, and for other purposes.
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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘United States Peace

5 Tax Fund Act’’.

6 SEC. 2. FINDINGS AND POLICY.

7 (a) FINDINGS.—The Congress finds that for a signifi8 cant minority of Americans, sincere conscientious objec9 tion to participation in war in any form means that such

10 Americans cannot in conscience pay the portion of their

11 taxes that would support military expenditures.

12 (b) POLICY.—It is the policy of the Congress—

13 (1) to improve revenue collections and to allow

14 conscientious objectors to pay their full tax liability

15 without violating their moral, ethical, or religious be16 liefs;

17 (2) to reduce the present administrative and ju18 dicial burden created by conscientious objectors who

19 violate tax laws rather than violate their consciences;

20 (3) to recognize conscientious objector status

21 with regard to the payment of taxes for military pur22 poses; and

23 (4) to provide a mechanism for congressional

24 appropriations of such funds for nonmilitary pur25 poses.
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1 SEC. 3. UNITED STATES PEACE TAX FUND.

2 (a) CREATION OF TRUST FUND.—There is hereby es3 tablished within the Treasury of the United States a spe4 cial trust fund to be known as the ‘‘United States Peace

5 Tax Fund’’ (hereinafter referred to as the ‘‘Fund’’). The

6 Fund shall consist of such amounts as may be transferred

7 to the Fund as provided in this section.

8 (b) TRANSFER TO FUND OF AMOUNTS EQUIVALENT

9 TO CERTAIN TAXES.—

10 (1) IN GENERAL.—There are hereby transferred

11 to the Fund amounts equivalent to the sum of the

12 amounts designated during the fiscal year by indi13 viduals under sections 2210, 2506, and 6099 of the

14 Internal Revenue Code of 1986 for payment into the

15 Fund. Such amounts shall be deposited into the

16 Fund and shall be available only for the purposes

17 provided in this Act.

18 (2) METHOD OF TRANSFER.—The amounts

19 transferred by paragraph (1) shall be transferred at

20 least monthly from the general fund of the Treasury

21 to the Fund on the basis of estimates by the Sec22 retary of the Treasury of the amounts, referred to

23 in paragraph (1), received in the Treasury. Proper

24 adjustments shall be made in the amounts subse25 quently transferred to the extent that prior esti-
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1 mates were in excess of or less than the amounts re2 quired to be transferred.

3 (3) REPORT.—The Secretary of the Treasury

4 shall report to the Committees on Appropriations of

5 the House of Representatives and the Senate each

6 year on the total amount transferred into the Fund

7 during the preceding fiscal year. Such report shall

8 be printed in the Congressional Record upon receipt

9 by the committees.

10 SEC. 4. INCOME TAX PAYMENTS TO UNITED STATES PEACE

11 TAX FUND.

12 (a) IN GENERAL.—Subchapter A of chapter 61 of the

13 Internal Revenue Code of 1986 (relating to information

14 and returns) is amended by adding at the end the follow15 ing new part:

16 ‘‘PART IX—DESIGNATION OF INCOME TAX PAY17 MENTS FOR TRANSFER TO UNITED STATES

18 PEACE TAX FUND

‘‘Sec. 6099. Designation by individuals.

19 ‘‘SEC. 6099. DESIGNATION BY INDIVIDUALS.

20 ‘‘(a) IN GENERAL.—Every eligible individual (other

21 than a nonresident alien) whose income tax liability for

22 any taxable year is $1 or more may designate that such

23 individual’s income tax payment for such year shall be
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1 paid into the United States Peace Tax Fund established

2 by section 3 of the United States Peace Tax Fund Act.

3 ‘‘(b) DEFINITIONS.—For purposes of this section—

4 ‘‘(1) ELIGIBLE INDIVIDUAL.—

5 ‘‘(A) IN GENERAL.—The term ‘eligible in6 dividual’ means an individual who by reason of

7 religious training and belief is conscientiously

8 opposed to participation in war in any form,

9 and who—

10 ‘‘(i) has been exempted or discharged

11 from combatant training and service in the

12 Armed Forces of the United States as a

13 conscientious objector under section 6(j) of

14 the Military Selective Service Act (50

15 U.S.C. App. 456(j)), or corresponding law,

16 or

17 ‘‘(ii) certified in a statement in a

18 questionnaire return made under section

19 6039F that such individual is conscien20 tiously opposed to participation in war in

21 any form within the meaning of section

22 6(j) of such Act.

23 ‘‘(B) VERIFICATION.—

24 ‘‘(i) QUESTIONNAIRE RETURN RE25 CEIPT.—Any taxpayer who makes a des-
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1 ignation under subsection (a) shall attach

2 the questionnaire return receipt provided

3 under section 6039F(b) to such taxpayer’s

4 return of tax.

5 ‘‘(ii) ADDITIONAL INFORMATION MAY

6 BE REQUIRED.—The Secretary may re7 quire any taxpayer who makes a designa8 tion under subsection (a) to provide such

9 additional information as may be necessary

10 to verify such taxpayer’s status as an eligi11 ble individual.

12 ‘‘(C) DENIAL OF DESIGNATION.—If the

13 Secretary determines that a taxpayer who

14 makes the designation provided for by sub15 section (a) is not an eligible individual and is

16 not entitled to make such designation, then the

17 Secretary, upon written notice to the taxpayer

18 stating the reasons for denial, may deny the

19 designation. The taxpayer may challenge the

20 Secretary’s ruling by bringing an action in the

21 United States Tax Court, or in the United

22 States district court for the district of such tax23 payer’s residence, for a declaratory judgment as

24 to whether the taxpayer is an eligible individual

25 and entitled to make such a designation.
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1 ‘‘(2) INCOME TAX LIABILITY.—The term ‘in2 come tax liability’ means the amount of the tax im3 posed by chapter 1 on a taxpayer for any taxable

4 year (as shown on such taxpayer’s tax return) re5 duced by the sum of—

6 ‘‘(A) the credits (as shown in such return)

7 allowable under part IV of subchapter A of

8 chapter 1 (other than subpart C thereof), and

9 ‘‘(B) the amount designated under section

10 6096.

11 ‘‘(3) INCOME TAX PAYMENT.—The term ‘in12 come tax payment’ means the amount of taxes im13 posed by chapter 1 and paid by or withheld from a

14 taxpayer for any taxable year not in excess of such

15 taxpayer’s income tax liability.

16 ‘‘(c) MANNER AND TIME OF DESIGNATION.—A des17 ignation under subsection (a) may be made with respect

18 to any taxable year either—

19 ‘‘(1) at the time of filing the return of the tax

20 imposed by chapter 1 for such taxable year, or

21 ‘‘(2) at any other time (after the time of filing

22 the return of the tax imposed by chapter 1 for such

23 taxable year) specified in regulations prescribed by

24 the Secretary.
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1 Such designation shall be made in such manner as the

2 Secretary prescribes by regulations except that, if such

3 designation is made at the time described in paragraph

4 (1), such designation shall be made on the page bearing

5 the taxpayer’s signature.

6 ‘‘(d) SPECIAL RULE IN THE CASE OF JOINT RE7 TURN.—In the case of an eligible individual filing a joint

8 return, upon the consent of such individual’s spouse, the

9 joint income tax payment may be designated pursuant to

10 subsection (a).

11 ‘‘(e) EXPLANATION OF UNITED STATES PEACE TAX

12 FUND PURPOSES.—Each publication of general instruc13 tions accompanying an income tax return or a question14 naire return described in section 6039F shall include—

15 ‘‘(1) an explanation of the purpose of the

16 United States Peace Tax Fund,

17 ‘‘(2) the criteria for determining whether an in18 dividual meets the requirements of section 6(j) of

19 the Military Selective Service Act (50 U.S.C. App.

20 456(j)), and

21 ‘‘(3) an explanation of the process for making

22 the designation provided by this section.’’.

23 (b) CLERICAL AMENDMENTS.—The table of parts of

24 subchapter A of chapter 61 of the Internal Revenue Code
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1 of 1986 is amended by adding at the end the following

2 new item:

‘‘Part IX—Designation of income tax payments for transfer to

United States Peace Tax Fund.’’.

3 (c) DESIGNATION INFORMATION.—

4 (1) Subpart A of part III of subchapter A of

5 chapter 61 of the Internal Revenue Code of 1986

6 (relating to information and returns) is amended by

7 adding at the end thereof the following new section:

8 ‘‘SEC. 6039F. UNITED STATES PEACE TAX FUND DESIGNA9 TION INFORMATION.

10 ‘‘(a) QUESTIONNAIRE RETURN.—Every taxpayer who

11 makes a designation described in section 6099(a) for any

12 taxable year shall make a questionnaire return during

13 such year as described in this section. The questionnaire

14 return shall request the taxpayer to certify such taxpayer’s

15 beliefs about participation in war, the source or genesis

16 of such beliefs, and how the beliefs affect the taxpayer’s

17 life.

18 ‘‘(b) QUESTIONNAIRE RETURN RECEIPT.—Upon re19 ceipt of a questionnaire return that is timely filed, the Sec20 retary shall issue a receipt to the taxpayer indicating time21 ly filing of such return.’’.

22 (2) The table of sections for such subpart is

23 amended by adding at the end the following new

24 item:
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‘‘Sec. 6039F. United States Peace Tax Fund designation information.’’.

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

2 this section shall apply with respect to—

3 (1) taxable years beginning after December 31,

4 1995, and

5 (2) any taxable year ending before January 1,

6 1996, for which the time for filing a claim for re7 fund or credit of an overpayment of tax has not ex8 pired on the date of the enactment of this Act.

9 (e) RULES APPLICABLE TO RETURNS OF TAX FOR

10 TAXABLE YEARS ENDING BEFORE DATE OF ENACT11 MENT.—

12 (1) PENALTIES FOR FAILURE TO PAY TAX.—

13 Notwithstanding any other law, any person’s failure

14 or refusal, before the date of the enactment of this

15 Act, to pay all or a part of the tax imposed by chap16 ter 1 of the Internal Revenue Code of 1986 shall not

17 be a violation of Federal law if the person—

18 (A) pays the tax due (with interest), and

19 (B) establishes to the satisfaction of the

20 Secretary of the Treasury that the failure or re21 fusal to pay was based upon such person’s con22 scientious objection to participation in war in

23 any form within the meaning of section
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1 6099(b)(1)(A) of such Code (defining eligible

2 individual).

3 (2) DISPOSITION OF AMOUNTS COLLECTED.—

4 There are hereby transferred to the Fund amounts

5 equivalent to the sum of the amounts paid into the

6 Treasury by persons under the provisions of para7 graph (1). Such amounts shall be deposited into the

8 Fund and shall be available only for the purposes

9 provided in this Act.

10 SEC. 5. ESTATE TAX PAYMENTS TO UNITED STATES PEACE

11 TAX FUND.

12 (a) IN GENERAL.—Subchapter C of chapter 11 of the

13 Internal Revenue Code of 1986 is amended by adding at

14 the end the following new section:

15 ‘‘SEC. 2210. DESIGNATION OF ESTATE TAX PAYMENTS FOR

16 TRANSFER TO UNITED STATES PEACE TAX

17 FUND.

18 ‘‘An eligible individual (within the meaning of section

19 6099(b)(1)) may elect that the tax imposed by section

20 2001 on the taxable estate of such individual shall be

21 transferred when paid to the United States Peace Tax

22 Fund established by section 3 of the United States Peace

23 Tax Fund Act. The election may be made by the executor

24 or administrator of the estate under written authority of
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1 the decedent. Such election shall be made in such manner

2 as the Secretary shall by regulations prescribe.’’.

3 (b) CLERICAL AMENDMENT.—The table of sections

4 for subchapter C of chapter 11 of the Internal Revenue

5 Code of 1986 is amended by adding at the end the follow6 ing:

‘‘Sec. 2210. Designation of estate tax payments for transfer to

United States Peace Tax Fund.’’.

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

8 this section shall apply with respect to the estates of dece9 dents dying after December 31, 1995.

10 SEC. 6. GIFT TAX PAYMENTS TO UNITED STATES PEACE

11 TAX FUND.

12 (a) IN GENERAL.—Subchapter A of chapter 12 of the

13 Internal Revenue Code of 1986 is amended by adding at

14 the end the following new section:

15 ‘‘SEC. 2506. DESIGNATION OF GIFT TAX PAYMENTS FOR

16 TRANSFER TO UNITED STATES PEACE TAX

17 FUND.

18 ‘‘Any eligible individual (within the meaning of sec19 tion 6099(b)(1)) may elect that the tax imposed by section

20 2501 shall be transferred when paid to the United States

21 Peace Tax Fund established by section 3 of the United

22 States Peace Tax Fund Act. The election shall be made

23 in such manner as the Secretary shall by regulations pre24 scribe.’’.
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1 (b) CLERICAL AMENDMENT.—The table of sections

2 for subchapter A of chapter 12 of the Internal Revenue

3 Code of 1986 is amended by adding at the end the follow4 ing new item:

‘‘Sec. 2506. Designation of gift tax payments for transfer to

United States Peace Tax Fund.’’.

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

6 this section shall apply with respect to gifts made after

7 December 31, 1995.

8 SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

9 (a) CERTIFICATION BY COMPTROLLER GENERAL.—

10 As soon after the close of each fiscal year as may be prac11 ticable, the Comptroller General shall determine and cer12 tify to the Congress and to the President the percentage

13 of actual appropriations made for a military purpose with

14 respect to such fiscal year. The certification shall be pub15 lished in the Congressional Record upon receipt by the

16 Congress.

17 (b) AUTHORIZATION OF APPROPRIATIONS.—There is

18 hereby authorized to be appropriated for each fiscal year

19 a certain portion of the Fund for obligation and expendi20 ture in accordance with the provisions of this Act. Such

21 portion is equal to an amount which is the sum of—

22 (1) the product of—

23 (A) all funds transferred to the Fund in

24 the previous fiscal year, times
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1 (B) the percentage determined under sub2 section (a) for such previous fiscal year, plus

3 (2) all funds in the Fund previously authorized

4 to be appropriated under this subsection but not yet

5 appropriated pursuant to this Act.

6 Funds remaining in the Fund shall accrue interest accord7 ing to the prevailing rate in long-term Government bonds.

8 (c) SURPLUS COVERED INTO GENERAL FUND.—For

9 each fiscal year, the portion of the Fund which is attrib10 utable to funds transferred to the Fund in the previous

11 fiscal year and which is not authorized to be appropriated

12 under subsection (b) is hereby covered into the general

13 fund of the Treasury of the United States. No part of

14 the funds transferred to the general fund under this sub15 section shall be appropriated for any expenditures, or oth16 erwise obligated, for a military purpose.

17 SEC. 8. ELIGIBLE APPROPRIATIONS.

18 (a) PAYMENTS.—Funds appropriated pursuant to the

19 authorization under section 7(b) shall be available, subject

20 to appropriation, to make grants, loans, or other arrange21 ments for eligible activities described in subsection (b).

22 (b) ELIGIBLE ACTIVITIES.—The following activities

23 are eligible to receive funds under subsection (a):

24 (1) Special Supplemental Food Program for

25 Women, Infants and Children (WIC);
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1 (2) Head Start;

2 (3) United States Institute of Peace; and

3 (4) Peace Corps.

4 (c) DISPLACEMENT OF OTHER FUNDS.—It is the in5 tent of this Act that the Fund shall not operate to release

6 funds for military expenditures which, were it not for the

7 existence of the Fund, would otherwise have been appro8 priated for nonmilitary expenditures.

9 SEC. 9. DEFINITIONS.

10 For the purposes of this Act—

11 (1) The term ‘‘military purpose’’ means any ac12 tivity or program which any agency of the Govern13 ment conducts, administers, or sponsors and which

14 effects an augmentation of military forces or of de15 fensive and offensive intelligence activities, or en16 hances the capability of any person or nation to

17 wage war.

18 (2) The term ‘‘actual appropriations made for

19 a military purpose’’ includes, but is not limited to,

20 amounts appropriated by the United States in con21 nection with—

22 (A) the Department of Defense;

23 (B) the Central Intelligence Agency;

24 (C) the National Security Council;

25 (D) the Selective Service System;
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1 (E) activities of the Department of Energy

2 that have a military purpose;

3 (F) activities of the National Aeronautics

4 and Space Administration that have a military

5 purpose;

6 (G) foreign military aid; and

7 (H) the training, supplying, or maintaining

8 of military personnel, or the manufacture, con9 struction, maintenance, or development of mili10 tary weapons, installations, or strategies.

11 (3) The term ‘‘agency’’ means each authority of

12 the Government of the United States, whether or

13 not it is within or subject to review by another agen14 cy, but does not include—

15 (A) the Congress; or

16 (B) the courts of the United States.

17 (4) The term ‘‘person’’ includes an individual,

18 partnership, corporation, association, or public or

19 private organization other than an agency.

20 SEC. 10. SEPARABILITY.

21 If any section, subsection, or other provision of this

22 Act, or the application thereof to any person or cir23 cumstance, is held invalid, the remainder of this Act and

24 the application of such section, subsection, or other provi-
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1 sion to other persons or circumstances shall not be af2 fected thereby.

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