Disabled Veterans Tax Termination Act
- Bill Number
- H.R. 333
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Armed Forces and National Security
- Status
- Introduced
- Latest Action
- 2025-02-11: Referred to the Subcommittee on Disability Assistance and Memorial Affairs.
- Last Updated
- 2025-06-27T08:06:18Z
AI-Generated Summary
H.R. 333: Disabled Veterans Tax Termination Act
Purpose
This bill aims to eliminate restrictions on military retirees receiving both retired pay (pension for service) and veterans' disability compensation (payments for service-related injuries or illnesses) at the same time. It expands eligibility to include retirees with lower disability ratings and those retired due to disability without full years of service, effectively ending a longstanding offset (reduction) in benefits often called the "disabled veterans tax."
Key Provisions
- Expansion of Concurrent Receipt for Lower Disability Ratings: Amends Section 1414(a) of Title 10, U.S. Code, to allow retirees with any service-connected disability rating (even below 50%) to receive full retired pay without reduction for disability compensation.
- Inclusion of Certain Disability Retirees: Updates Section 1414(b) to extend benefits to "chapter 61" retirees—those medically retired under Chapter 61 of Title 10 due to disability with fewer than 20 years of creditable service. Their retired pay is reduced only if it exceeds a formula based on 2.5% of years served times their pay base (a calculation similar to standard retirement formulas).
- End of Phase-In Period: Removes transitional rules that gradually increased concurrent receipt benefits over time, making full concurrent payments immediate for all eligible retirees.
- Technical and Clerical Updates: Revises section headings, tables of contents, and cross-references in Title 10 to reflect the changes; also updates a related section (1413a) for consistency.
- Effective Date: Changes apply starting the first day of the first month after enactment, affecting payments from that point forward.
Significant Changes to Existing Law
- Previously, under the Concurrent Retirement and Disability Pay (CRDP) program, only retirees with disabilities rated 50% or higher could receive both benefits without offset. This bill removes that 50% threshold, allowing all rated disabilities to qualify.
- Chapter 61 retirees with less than 20 years of service were previously ineligible for full concurrent receipt; the bill now includes them with a partial offset based on service length, replacing stricter prior reductions under Title 38 (which barred concurrent payments entirely in many cases).
- Eliminates the multi-year phase-in of CRDP benefits (originally set to fully end offsets by 2014 but with lingering restrictions), providing immediate full access.
Potential Impacts
- On Citizens: Primarily benefits military veterans by increasing their total income—potentially by thousands of dollars annually—without forcing a choice between retired pay and disability compensation. This could improve financial stability for disabled retirees, especially those with moderate disabilities or shorter service.
- On Government Agencies: Increases costs for the Department of Defense (DoD) and Department of Veterans Affairs (VA), as they must pay both benefits concurrently without offsets. Estimates suggest billions in additional federal spending over time, requiring budget adjustments in defense and veterans' affairs appropriations.
- On International Relations: No direct impact, as the bill focuses on domestic military and veterans' benefits.
Main Stakeholders Affected
- Disabled Military Retirees: Primary beneficiaries, including those with disability ratings under 50% and chapter 61 retirees with less than 20 years of service (potentially hundreds of thousands of veterans).
- Department of Defense (DoD) and Department of Veterans Affairs (VA): Responsible for implementing changes, processing payments, and managing increased fiscal outlays.
- Congress and Taxpayers: Must fund the expanded benefits through appropriations; veterans' advocacy groups (e.g., American Legion, VFW) likely support it as a pro-veteran measure.
Notable Legal, Constitutional, or Political Implications
- Legal: Streamlines and expands the CRDP program under Title 10, aligning it more closely with Title 38 (veterans' benefits law) by reducing conflicts in offset rules. No challenges to statutory authority; amendments are procedural and build on existing concurrent receipt laws (e.g., from the 2004 National Defense Authorization Act).
- Constitutional: No apparent issues, as it involves congressional spending power over military compensation (Article I, Section 8) and does not infringe on due process or equal protection, though it creates new distinctions based on service length for chapter 61 retirees.
- Political: Positions as veteran-friendly legislation, appealing to bipartisan support for military families. Could influence future defense budgets by highlighting tensions between benefit expansions and fiscal constraints; referred to House Armed Services and Veterans' Affairs Committees for review, indicating potential for amendments during debate.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Bishop, Sanford D. [D-GA-2]
Cosponsors (3)
Rep. Amo, Gabe [D-RI-1], Rep. Brownley, Julia [D-CA-26], Rep. Hamadeh, Abraham J. [R-AZ-8]
Recent Actions
- 2025-02-11: Referred to the Subcommittee on Disability Assistance and Memorial Affairs.
- 2025-01-13: Referred to the Committee on Armed Services, and in addition to the Committee on Veterans' Affairs, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-01-13: Referred to the Committee on Armed Services, and in addition to the Committee on Veterans' Affairs, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-01-13: Introduced in House
- 2025-01-13: Introduced in House
Bill Versions
- Disabled Veterans Tax Termination Act — issued 2025-01-13 — PDF (4 pages)