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The continued degradation of our veterans’ job opportunities and personal finances after their service to the military, has spurred members of Congress to take action and pass the Heroes Earning Assistance and Relief Tax (HEART) Act.

The HEART Act, sponsored by the House Ways and Means Committee Chairman Rep. Charles Rangel, D-N.Y., was approved by the House of Representatives on Tuesday, May 20 in a unanimous 403 - 0 vote.

This Act provides $1.3 million dollars in tax relief to the military community, as well as expanded home ownership opportunities, and the ability for military personnel to secure employment before and after their service.

Some of the more notable permanent provisions of the HEART Act allows active-duty reservists to make penalty-free withdrawals from retirement plans, and makes the Earned Income Tax Credit a permanent inclusion into Soldiers’ combat pay. Additionally, the bill ensures that reservists called up to active duty do not suffer a pay cut; and provides a small tax credit to small businesses who continue to pay reservists and guardsmen who are deployed.

Other provisions will attempt to ease the financial burden on military families by doing the following:

• Permitting an employer to make contributions to a qualified retirement plan on behalf of an employee killed or disabled during combat.
• Counting extra pay for active-duty military personnel from their previous civilian employer for retirement purposes.
• Making thousands of veterans eligible for low-interest loans by changing the qualified mortgage bond programs used to help veterans achieve homeownership.
• Permitting recipients of military death benefit gratuities to roll over the amounts received tax free, to a Roth IRA or Education Saving Account.
• Revising tax rules relating to U.S. citizens and permanent residents (expatriates) who relinquish citizenship or residency to avoid U.S. taxation.

What’s more, the HEART Act will be paid for by Congress going after expatriates and federal contractors who go offshore to avoid paying U.S. Taxes.

“This tax relief for military families is the least Congress can do for our troops who put their lives on the line every day,” said, Nancy Pelosi, Speaker of the House, in a written statement.

“I look forward to the Senate passing the HEART Act and the President signing this critical legislation into law,” Pelosi added.

Congress hopes to have President Bush sign this new legislation into law by this Memorial Day.