House committee approves military tax breaks

House committee approves military tax breaks
By William H. McMichael - Staff writer
Posted : Thursday Nov 1, 2007 21:03:55 EDT

Service members, veterans, firefighters and certain volunteers moved a step closer to maintaining current tax and earnings benefits — and gaining new ones — under a bill approved Thursday by a House committee.

The House Ways and Means Committee agreed to the Heroes Earnings Assistance and Relief Tax Act of 2007 without a quibble over the bill’s 14 benefits, which include making permanent a provision that makes the refundable Earned Income Tax Credit more accessible for military personnel.

“America is forever in debt to the women and men in the armed forces for the great sacrifice they make on behalf of all Americans,” Rep. Charles Rangel, D-N.Y., the committee chairman and chief sponsor of the bill, said in a statement. “This bill makes a small but important step honoring their commitment by giving much needed tax relief to them and other volunteers who are our first line of defense in times of emergencies.”

“There’s a lot of good things in here that do little things to make the system work better,” said Rep. Jim McDermott, D-Wash.

One such thing is the Earned Income Tax Credit. Under current law, pay earned by all enlisted members and most junior officers in a combat zone isn’t subject to federal tax. But a certain baseline level of taxable income is required to qualify for the Earned Income Tax Credit, which is aimed mainly at helping low-income households stay off welfare. The credit can translate into a larger refund, depending on the amount earned and how many children live in the household.


Rest of article at: http://www.armytimes.com/news/2007/11/military_taxbreaks_071101w/