S. 1906

A bill to amend the Internal Revenue Code of 1986 to exclude property tax rebates and other benefits provided to volunteer firefighters, search and rescue personnel, and emergency medical responders from income and employment taxes and wage withholding.

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II

109th CONGRESS

1st Session

S. 1906

IN THE SENATE OF THE UNITED STATES

October 21, 2005

Mr. Dodd (for himself and Mr. Smith) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to exclude property tax rebates and other benefits provided to volunteer firefighters, search and rescue personnel, and emergency medical responders from income and employment taxes and wage withholding.

1.

Exclusion of property tax rebates and other benefits provided to volunteer firefighters, search and rescue personnel, and emergency medical responders from income and employment taxes and wage withholding

(a)

Exclusion from gross income

(1)

In general

Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by redesignating section 140 as section 140A and by inserting after section 139 the following new section:

140.

Property tax rebates and other benefits provided to volunteer firefighters, search and rescue personnel, and emergency medical responders

(a)

Exclusion

Gross income shall not include a qualified property tax rebate or other benefit.

(b)

Qualified property tax rebate or other benefit

For purposes of subsection (a)—

(1)

In general

The term qualified property tax rebate or other benefit means a rebate of real or personal property taxes, or any other benefit, provided by a State or political subdivision on account of services performed as a member of a qualified volunteer emergency response organization.

(2)

Qualified volunteer emergency response organization

The term qualified volunteer emergency response organization means any volunteer organization—

(A)

which is organized and operated to provide firefighting, search and rescue, or emergency medical services for persons in the State or political subdivision, as the case may be, and

(B)

which is required (by written agreement) by the State or political subdivision to furnish firefighting, search and rescue, or emergency medical services in such State or political subdivision.

.

(2)

Clerical amendment

The table of sections for such part is amended by striking the last item and inserting the following new items:

Sec. 140. Property tax rebates and other benefits provided to volunteer firefighters, search and rescue personnel, and emergency medical responders.

Sec. 140A. Cross references to other Acts.

.

(b)

Exclusion from employment taxes

(1)

Social security taxes

(A)

Section 3121(a) of the Internal Revenue Code of 1986 (relating to definition of wages) is amended by striking or at the end of paragraph (21), by striking the period at the end of paragraph (22) and inserting ; or, and by inserting after paragraph (22) the following new paragraph:

(23)

any qualified property tax rebate or other benefit (as defined in section 140(b)).

.

(B)

Section 209(a) of the Social Security Act is amended by striking or at the end of paragraph (18), by striking the period at the end of paragraph (19) and inserting ; or, and by inserting after paragraph (19) the following new paragraph:

(20)

Any qualified property tax rebate or other benefit (as defined in section 140(b) of the Internal Revenue Code of 1986).

.

(2)

Unemployment taxes

Section 3306(b) of the Internal Revenue Code of 1986 (relating to definition of wages) is amended by striking or at the end of paragraph (18), by striking the period at the end of paragraph (19) and inserting ; or, and by inserting after paragraph (19) the following new paragraph:

(20)

any qualified property tax rebate or other benefit (as defined in section 140(b).

.

(c)

Wage withholding

Section 3401(a) of the Internal Revenue Code of 1986 (defining wages) is amended by striking or at the end of paragraph (21), by striking the period at the end of paragraph (22) and inserting ; or, and by inserting after paragraph (22) the following new paragraph:

(23)

for any qualified property tax rebate or other benefit (as defined in section 140(b).

.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.