Congress has acted quickly in the face of an insurmountable emotional tragedy engulfing the nation to provide tax relief to those affected most, “any individual who dies as a result of wounds or injury incurred as a result of the terrorist attacks against the United States on September 11, 2001.” Their tax obligations for “the taxable year in which falls the date of such individual's death” and “any prior taxable year in the period beginning with the last taxable year ending before the taxable year in which the wounds or injury were incurred”, according to the Victims of Terrorism Relief Act of 2001, have been excused. This is the same tax treatment extended to those injured or died while serving their country in the military.
In addition, “The additional estate tax shall not apply to the transfer of the taxable estate of any individual who dies as a result of wounds or injury incurred as a result of the terrorist attacks against the United States on September 11, 2001.” This reduces the estate tax liability by more than half.
According to the GOP news release, “The Victims of Terrorism Relief Act reduces estate taxes for victims of the terrorist attack and members of the armed forces killed in combat, exempting victims of the terrorist attack and federal military and civilian personnel killed outside the United States from income taxes, making passenger payments from United or American Airlines tax exempt, and making Federal Emergency Management Agency (FEMA) payments tax exempt.” Congress knows that nothing will change the scarred hearts of the American public after that horrific and dark day in September but those put into office by the same public are ready to do their part to make it a little bit more bearable for those victims and their loved ones.
Full text of the legislation is as follows:
AN ACT
To amend the Internal Revenue Code of 1986 to provide tax relief for victims of the terrorist attacks against the United States on September 11, 2001. 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 `Victims of Terrorism Relief Act of 2001'.
SEC. 2. INCOME TAXES OF VICTIMS OF TERRORIST ATTACKS.
(a) IN GENERAL- Section 692 of the Internal Revenue Code of 1986 (relating to income taxes of members of Armed Forces on death) is amended by adding at the end the following new subsection:
‘(d) CERTAIN INDIVIDUALS DYING AS A RESULT OF SEPTEMBER 11, 2001, TERRORIST ATTACKS-
‘(1) IN GENERAL- In the case of any individual who dies as a result of wounds or injury incurred as a result of the terrorist attacks against the United States on September 11, 2001, any tax imposed by this subtitle shall not apply--
‘(A) with respect to the taxable year in which falls the date of such individual's death, and
`(B) with respect to any prior taxable year in the period beginning with the last taxable year ending before the taxable year in which the wounds or injury were incurred.
‘(2) EXCEPTION- Paragraph (1) shall not apply to an individual whom the Secretary determines was a perpetrator of any such terrorist attack.'.
(b) CONFORMING AND CLERICAL AMENDMENTS-
(1) The heading of section 692 of such Code is amended to read as follows:
`SEC. 692. INCOME TAXES OF MEMBERS OF ARMED FORCES ON DEATH AND VICTIMS OF CERTAIN TERRORIST ATTACKS.'.
(2) The item relating to section 692 in the table of sections for part II of subchapter J of chapter 1 of such Code is amended to read as follows:
`Sec. 692. Income taxes of members of Armed Forces on death and victims of certain terrorist attacks.'.
(3) Section 5(b)(1) of such Code is amended by inserting `and victims of certain terrorist attacks' after `on death'.
(4) Section 6013(f)(2)(B) of such Code is amended by inserting `and victims of certain terrorist attacks' after `on death'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years ending on or after September 11, 2001.
SEC. 3. RELIEF FROM ADDITIONAL ESTATE TAX.
(a) IN GENERAL- Section 2201 of the Internal Revenue Code of 1986 is amended--
(1) in the first sentence by inserting `(a) IN GENERAL- ' before `The additional estate tax'; and
(2) by adding at the end the following:
`(b) VICTIMS OF CERTAIN TERRORIST ATTACKS- The additional estate tax shall not apply to the transfer of the taxable estate of any individual who dies as a result of wounds or injury incurred as a result of the terrorist attacks against the United States on September 11, 2001. The preceding sentence shall not apply with respect to any individual whom the Secretary determines was a perpetrator of any such terrorist attack.'.
(b) CLERICAL AMENDMENTS-
(1) The heading of section 2201 of such Code is amended to read as follows:
`SEC. 2201. COMBAT ZONE-RELATED DEATHS OF MEMBERS OF THE ARMED FORCES AND DEATHS OF VICTIMS OF CERTAIN TERRORIST ATTACKS.'.
(2) The item relating to section 2201 in the table of sections for subchapter C of chapter 11 of such Code is amended to read as follows:
`Sec. 2201. Combat zone-related deaths of members of the Armed Forces and deaths of victims of certain terrorist attacks.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to estates of decedents dying on or after September 11, 2001.
Passed the House of Representatives September 13, 2001.
Attest:
Clerk.
107th CONGRESS
1st Session
H. R. 2884
AN ACT
To amend the Internal Revenue Code of 1986 to provide tax relief for victims of the terrorist attacks against the United States on September 11, 2001.
