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Washington, DC -- U.S. Rep. Ron Klein (FL-22) Wednesday introduced two key tax relief bills that will provide critical support and assistance to American families, teachers, members of the U.S. military and their families.
“This week I introduced The Healthy Families and Dedicated Teachers Tax Relief Act to provide critical tax relief to families and teachers who are doing the right thing by giving back to society, sending their kids to school, or investing in education and efficient energy sources,” said Klein. “This bill extends a provision set to expire that allows families to deduct state and local sales taxes from their federal income taxes. This bill also gives families who want to give to charitable causes more flexibility in doing so by allowing them to give donations from their IRAs, without a tax penalty.
“The Healthy Families and Dedicated Teachers Tax Relief Act also reduces the burden on families who are trying to send their kids to college by allowing them to deduct the cost of tuition, books, and school supplies from their federal taxes. My bill also provides relief to families who invest in home-efficient energy sources, such as solar heating panels and other energy-saving materials. And finally, my bill helps teachers who use their personal money to deduct school supplies and other school-related items from their year-end taxes.”
Klein also introduced The Military Service Tax Relief Act this week, which provides significant assistance to members of the military and their families. This bill permanently extends a current provision that allows military members called to active duty to make withdrawls-- penalty-free -- from their retirement plans. It also continues to allow members of the military to include combat pay as earned income, thus allowing more military members to further capitalize on the Earned Income Tax Credit.
“Our men and women who have left their jobs and families to serve our country should not be penalized for using their current resources to help make ends meet and provide for their families during their time away,” said Klein. “The Military Service Tax Relief Act allows those serving in active duty to withdraw income, penalty free, from their retirement plans. My bill also expands the opportunity for military members to receive the tax benefits of the Earned Income Tax Credit. This extender would especially help lower-income military members, by permitting them to elect to include combat pay as a part of their Earned Income Tax Credit calculation.”
**The Healthy Families and Dedicated Teachers Tax Relief Act provides for:**
* A permanent extension of state and local general sales taxes. The IRS Code currently allows residents of states that charge an income tax to deduct their state income tax from their federal tax, but does not allow the same treatment of sales tax. This extension of the sales tax exemption is an issue that resonates in Florida since the state relies on the sales tax, rather than an income tax, to generate revenue.
* A permanent extension of tax-free distributions from IRAs for charitable purposes. This would allow more flexibility for those looking to make charitable contributions by providing them with the ability to tap their IRAs without invoking a tax consequence.
* A five-year extension of the deduction for certain expenses of elementary and secondary school teachers. The deduction would be increased to cap at $500, instead of the current $250. This provision would allow teachers to deduct expenses incurred relating to their professional development.
* A 5-year extension of the residential energy efficient property credit. This would provide a deduction for homeowners who make solar electric property expenditures, including solar water heating property expenditures and qualified fuel cell property expenditures.
* A 5-year extension of the above the line deduction for qualified tuition and related expenses. This provision allows for the deduction of qualified tuition expenses. Expenses could include items such as tuition, fees, books and supplies.
**The Military Service Tax Relief Act provides for:**
* A permanent extension of penalty-free withdrawals from retirement plans for those called to active duty. This allows for any qualified reservist distributions that occur after September 11, 2001, to be excluded from the penalty. This would be something that we would want to market to the local National Guard and other military support groups.
* A permanent extension of the election to include combat pay as earned income for purposes of the Earned Income Tax Credit. This extender would allow lower-income military members to further capitalize on the earned income tax credit by allowing them to elect to include combat pay as a part of the EITC calculation.
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