I

104TH CONGRESS

1ST SESSION H. R. 1762

To amend the Internal Revenue Code of 1986 to deny Federal tax return

information to States which impose an income tax on the pension income

of individuals who are neither residents nor domiciliaries of the State.

IN THE HOUSE OF REPRESENTATIVES

JUNE 7, 1995

Mr. ENSIGN (for himself, Mrs. VUCANOVICH, Mr. CALVERT, Mr. FOX of Pennsylvania, Mr. MCDERMOTT, Mr. DOOLITTLE, Mr. CHRISTENSEN, Mr.

HASTINGS of Washington, Mr. SCHIFF, and Mr. BROWDER) 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 deny Federal tax return information to States which impose an

income tax on the pension income of individuals who

are neither residents nor domiciliaries of the State.

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. DENIAL OF TAX INFORMATION TO STATES TAX2 ING PENSION INCOME OF INDIVIDUALS WHO

3 ARE NEITHER RESIDENTS NOR DOMICIL4 IARIES OF THE STATE.

5 (a) IN GENERAL.—Subsection (d) of section 6103 of

6 the Internal Revenue Code of 1986 (relating to disclosure

7 to State tax officials and State and local law enforcement

8 agencies) is amended by adding at the end the following

9 new paragraph:

10 ‘‘(5) DENIAL OF INFORMATION TO STATES

11 WHICH IMPOSE PENSION SOURCE TAX.—

12 ‘‘(A) IN GENERAL.—No returns or return

13 information may be disclosed under paragraph

14 (1) to any agency, body, or commission of a

15 State (or any legal representative thereof) dur16 ing any period that such State imposes a pen17 sion source tax.

18 ‘‘(B) PENSION SOURCE TAX.—For pur19 poses of subparagraph (A), the term ‘pension

20 source tax’ means any tax on the retirement in21 come of any individual who is neither a resident

22 nor a domiciliary of such State.

23 ‘‘(C) RETIREMENT INCOME.—The term

24 ‘retirement income’ means any income from—

25 ‘‘(i) a qualified retirement plan (as

26 defined in section 4974(c)),
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1 ‘‘(ii) a simplified employee pension (as

2 defined in section 408(k) of such Code);

3 ‘‘(iii) an eligible deferred compensa4 tion plan (as defined in section 457 of such

5 Code);

6 ‘‘(iv) a governmental plan (as defined

7 in section 414(d) of such Code);

8 ‘‘(v) a trust described in section

9 501(c)(18) of such Code; or

10 ‘‘(vi) a nonqualified deferred com11 pensation plan (as defined in section

12 3121(v)(2)(C) of such Code).

13 Such term includes any retired or retainer pay

14 of a member or former member of a uniform

15 service computed under chapter 71 of title 10,

16 United States Code.’’

17 (b) TECHNICAL AMENDMENT.—Subparagraph (B) of

18 section 6103(b)(5) of such Code is amended by striking

19 ‘‘(d)(1)’’ and inserting ‘‘(d)’’.

20 (c) EFFECTIVE DATE.—

21 (1) IN GENERAL.—The amendments made by

22 this section shall take effect on the day after the

23 close of the 1-year period beginning on the date of

24 the enactment of this Act.
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1 (2) COORDINATION WITH STATE LEGISLA2 TURES.—In no event shall the 1-year period referred

3 to in paragraph (1) end with respect to any State

4 before the earlier of—

5 (A) the close of the first session of the

6 State legislature which begins after the date of

7 the enactment of this Act, or

8 (B) the close of a session of the State leg9 islature which begins before such date and re10 mains in session for at least 25 calendar days

11 after such date.

12 (3) SPECIAL RULES.—For purposes of para13 graph (2)—

14 (A) In the case of a State which has a 2-

15 year legislative session, each year of such ses16 sion shall be treated as a separate regular ses17 sion of the State legislature.

18 (B) The term ‘‘State’’ has the meaning

19 given to such term by section 6103(b)(5) of the

20 Internal Revenue Code of 1986.

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