H. R. 1499

One Hundred Ninth Congress

of the

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Tuesday, 

the third day of January, two thousand and six 

An Act 

To amend the Internal Revenue Code of 1986 to allow members of the Armed 

Forces serving in a combat zone to make contributions to their individual retirement plans even if the compensation on which such contribution is based is 

excluded from gross income, and for other purposes.

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Heroes Earned Retirement 

Opportunities Act’’. 

SEC. 2. COMBAT ZONE COMPENSATION TAKEN INTO ACCOUNT FOR 

PURPOSES OF DETERMINING LIMITATION AND DEDUCTIBILITY OF CONTRIBUTIONS TO INDIVIDUAL RETIREMENT PLANS. 

(a) IN GENERAL.—Subsection (f) of section 219 of the Internal 

Revenue Code of 1986 is amended by redesignating paragraph 

(7) as paragraph (8) and by inserting after paragraph (6) the following new paragraph: 

‘‘(7) SPECIAL RULE FOR COMPENSATION EARNED BY MEMBERS

OF THE ARMED FORCES FOR SERVICE IN A COMBAT ZONE.—For 

purposes of subsections (b)(1)(B) and (c), the amount of compensation includible in an individual’s gross income shall be 

determined without regard to section 112.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2003.

(c) CONTRIBUTIONS FOR TAXABLE YEARS ENDING BEFORE ENACT- MENT.— (1) IN GENERAL.—In the case of any taxpayer with respect 

to whom compensation was excluded from gross income under 

section 112 of the Internal Revenue Code of 1986 for any 

taxable year beginning after December 31, 2003, and ending 

before the date of the enactment of this Act, any contribution 

to an individual retirement plan made on account of such 

taxable year and not later than the last day of the 3-year 

period beginning on the date of the enactment of this Act 

shall be treated, for purposes of such Code, as having been 

made on the last day of such taxable year. 

(2) WAIVER OF LIMITATIONS.—

(A) CREDIT OR REFUND.—If the credit or refund of 

any overpayment of tax resulting from a contribution to 

which paragraph (1) applies is prevented at any time by 

the operation of any law or rule of law (including res 

judicata), such credit or refund may nevertheless be allowed 
H. R. 1499—2

or made if the claim therefor is filed before the close 

of the 1-year period beginning on the date that such contribution is made (determined without regard to paragraph 

(1)). 

(B) ASSESSMENT OF DEFICIENCY.—The period for 

assessing a deficiency attributable to a contribution to 

which paragraph (1) applies shall not expire before the 

close of the 3-year period beginning on the date that such 

contribution is made. Such deficiency may be assessed 

before the expiration of such 3-year period notwithstanding 

the provisions of any other law or rule of law which would 

otherwise prevent such assessment. 

(3) INDIVIDUAL RETIREMENT PLAN DEFINED.—For purposes 

of this subsection, the term ‘‘individual retirement plan’’ has 

the meaning given such term by section 7701(a)(37) of such 

Code.

Speaker of the House of Representatives.

Vice President of the United States and

President of the Senate.