Washington (Sept. 12, 2002) -- Political responses to the tragedy of 9/11 ran the gamut from two new laws providing tax relief and job creation, to pending legislation on homeland security and tax fairness for military families.
Congress responded to last year's terror attacks, the House Ways and Means Committee says, by passing two House bills into law--the Victims of Terrorism Tax Relief Act of 2001, and the Job Creation and Worker Assistance Act.
Two other bills--the Homeland Security Act of 2002 and the Armed Services Tax Fairness Act of 2002--are still under consideration by the Senate.
Among the provisions that have become law are a reduction in estate tax to victims of the terrorist attacks, exemption from income tax in the year of death, an exemption of the $25,000 per passenger payments made by United Airlines from income tax, and a clarification that disaster relief payments are tax free. In addition, a number of incentives were provided to bring relief to displaced workers and stimulate the investment climate for businesses in the area affected by the attacks.
Tax provisions still under consideration amend the Tax Code to provide tax-free treatment for the full gratuity death payment to members of the Armed Services. Since 1991, when the payment was increased from $3,000 to $6,000, only half of the payment has been tax-free. The legislation also permits uniformed personnel to suspend the time spent away from home while on assignment for purposes of the two-year and five-year periods for exclusion of capital gains on the sale of a home.
-- Electronic Accountant Newswire staff
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