September 26, 2003

Panel allows deductions for retirees' health premiums

By Greta Wodele, National Journal's Technology Daily

The House Government Reform Committee on Thursday passed a bill to allow tax deductions for federal civilian and military retirees paying into federal health insurance premium programs.

The bill (H.R. 1231) would amend the U.S. tax code to allow federal civilian and military retirees to pay into the Federal Employees Health Benefits Program on a pretax basis and allow active duty military personnel to apply a deduction for supplemental payments for TRICARE—the military's healthcare plan. The panel passed the measure by voice vote.

Committee Chairman Tom Davis of Virginia noted the federal retirement plan covers 8.6 million individuals, including 2.2 million federal and postal employees, 1.9 million federal annuitants and 4.5 million dependents.

The bill, which was first introduced in the 106th Congress, has 305 cosponsors. Sen. John Warner, R-Va., introduced a similar version of the measure (S. 623) with 46 cosponsors, but the bill has yet to be passed by the Senate Finance Committee.