On Thursday, President Bush signed the Victims of Terrorism Tax Relief Act of 2001 (H.R.2884), which provides tax relief to families of people killed in the terrorist attacks of September 11, the anthrax mailings that occurred after September 11, and the Oklahoma City bombing.
The bill provides relief on several levels:
- Income and payroll tax for victims is waived for the year of death and the preceding year. If the total waived income tax is not at least $10,000, a minimum benefit of $10,000 for the two years will apply. The bill does not address how tax will be computed, for purposes of this waiver, in the case of income jointly earned by a victim and a surviving spouse.
- Income tax will not be assessed on money paid by charitable organizations to families of terrorist victims.
- Families of terrorist victims and members of the military who died in combat zones will be entitled to use a schedule of estate taxes that is lower than the estate tax schedule currently in place.
"The legislation passed by Congress will relieve the tax burden on families who have lost loved ones," said President Bush. "The Victims of Terrorist Tax Relief Act is an important example of our national unity and resolve, and it's my honor to sign it today."
You can read the text of the bill by entering H.R.2884 in the "Bill Number" area at the Library of Congress's Thomas Web site.