I 

109TH CONGRESS 

2D SESSION H. R. 4727 

To amend the Internal Revenue Code of 1986 to provide for an extension 

of the period of limitation to file claims for refunds on account of 

disability determinations by the Department of Veterans Affairs. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 8, 2006 

Mr. FARR (for himself, Mr. ABERCROMBIE, Mr. BISHOP of Georgia, Mr. BILIRAKIS, Mr. BOSWELL, Mr. BURTON of Indiana, Ms. CARSON, Mr. CONYERS, Mr. CASE, Mr. DOGGETT, Mr. EVANS, Mr. FILNER, Mr. AL

GREEN of Texas, Mr. GRIJALVA, Ms. HERSETH, Mr. HIGGINS, Mr. 

HONDA, Mr. HOLT, Mrs. MALONEY, Ms. MATSUI, Ms. MCCOLLUM of 

Minnesota, Mr. PETERSON of Minnesota, Mr. SCHIFF, Mr. SPRATT, Mr. 

UDALL of New Mexico, Ms. WASSERMAN SCHULTZ, Mr. WAXMAN, Mr. 

NEY, Mr. RANGEL, Mr. SKELTON, Ms. SCHAKOWSKY, and Mr. KENNEDY

of Rhode Island) 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 provide 

for an extension of the period of limitation to file claims 

for refunds on account of disability determinations by 

the Department of Veterans Affairs. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
2 

•HR 4727 IH 

1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Disabled Veterans Tax 

3 Fairness Act of 2006’’. 

4 SEC. 2. SPECIAL PERIOD OF LIMITATION WHEN UNI5 FORMED SERVICES RETIRED PAY IS RE6 DUCED AS A RESULT OF AWARD OF DIS7 ABILITY COMPENSATION. 

8 (a) IN GENERAL.—Subsection (d) of section 6511 of 

9 the Internal Revenue Code of 1986 (relating to special 

10 rules applicable to income taxes) is amended by adding 

11 at the end the following new paragraph: 

12 ‘‘(8) SPECIAL RULES WHEN UNIFORMED SERV13 ICES RETIRED PAY IS REDUCED AS A RESULT OF

14 AWARD OF DISABILITY COMPENSATION.— 

15 ‘‘(A) PERIOD OF LIMITATION ON FILING

16 CLAIM.—If the claim for credit or refund re17 lates to an overpayment of tax imposed by sub18 title A on account of— 

19 ‘‘(i) the reduction of uniformed serv20 ices retired pay computed under section 

21 1406 or 1407 of title 10, United States 

22 Code, or 

23 ‘‘(ii) the waiver of such pay under sec24 tion 5305 of title 38 of such Code, 

25 as a result of an award of compensation under 

26 title 38 of such Code pursuant to a determina-
3 

•HR 4727 IH 

1 tion by the Secretary of Veterans Affairs, the 3- 

2 year period of limitation prescribed in sub3 section (a) shall be extended, for purposes of 

4 permitting a credit or refund based upon the 

5 amount of such reduction or waiver, until the 

6 end of the 1-year period beginning on the date 

7 of such determination. 

8 ‘‘(B) LIMITATION TO 15 TAXABLE

9 YEARS.—Subparagraph (A) shall not apply with 

10 respect to any taxable year which began more 

11 than 15 years before the date of such deter12 mination.’’. 

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

14 subsection (a) shall apply to claims for credit or refund 

15 filed after the date of the enactment of this Act. 

16 (c) TRANSITION RULES.—In the case of a determina17 tion described in paragraph (8) of section 6511(d) of the 

18 Internal Revenue Code of 1986 (as added by this section) 

19 which is made by the Secretary of Veterans Affairs after 

20 December 31, 1989, and before the date of the enactment 

21 of this Act, such paragraph— 

22 (1) shall not apply with respect to any taxable 

23 year which began before December 31, 1989, and 

24 (2) shall be applied by substituting ‘‘the date of 

25 the enactment of the Disabled Veterans Tax Fair-
4 

•HR 4727 IH 

1 ness Act of 2006’’ for ‘‘the date of such determina2 tion’’ in subparagraph (A) thereof. 

Æ