[House Report 114-816]
[From the U.S. Government Publishing Office]
114th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 114-816
======================================================================
MILITARY RESIDENCY CHOICE ACT
_______
November 14, 2016.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Miller of Florida, from the Committee on Veterans' Affairs,
submitted the following
R E P O R T
[To accompany H.R. 5428]
[Including cost estimate of the Congressional Budget Office]
The Committee on Veterans' Affairs, to whom was referred
the bill (H.R. 5428) to amend the Servicemembers Civil Relief
Act to authorize spouses of servicemembers to elect to use the
same residences as the servicemembers, having considered the
same, report favorably thereon without amendment and recommend
that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 3
Subcommittee Consideration....................................... 4
Committee Consideration.......................................... 4
Committee Votes.................................................. 4
Committee Oversight Findings..................................... 5
Statement of General Performance Goals and Objectives............ 5
New Budget Authority, Entitlement Authority, and Tax Expenditures 5
Earmarks and Tax and Tariff Benefits............................. 5
Committee Cost Estimate.......................................... 5
Congressional Budget Office Estimate............................. 5
Federal Mandates Statement....................................... 7
Advisory Committee Statement..................................... 7
Constitutional Authority Statement............................... 7
Applicability to Legislative Branch.............................. 7
Statement on Duplication of Federal Programs..................... 7
Disclosure of Directed Rulemaking................................ 7
Section-by-Section Analysis of the Legislation................... 7
Changes in Existing Law Made by the Bill as Reported............. 8
Purpose and Summary
H.R. 5428, the ``Military Residency Choice Act,'' was
introduced by Representative Randy Forbes of Virginia on June
9, 2016. H.R. 5428 would amend the Servicemember Civil Relief
Act (SCRA) to allow a servicemember's spouse to claim the same
state of residency as the servicemember for voting and tax
purposes even if the spouse has not lived in that state.
Background and Need for Legislation
Section 1. Short title
Section 1 cites the short title of H.R. 5428, to be the
``Military Residency Choice Act.''
Section 2. Residence of spouses of servicemembers for tax purposes
Since the codification of the SCRA in 1942, Congress has
recognized that active duty servicemembers should be afforded
certain legal protections during their years of military
service. Among other provisions, the SCRA allows servicemembers
to maintain their place of residency in a State for certain
purposes, such as voting and State and local income taxes,
regardless of whether the servicemember is currently residing
in that State or is absent from that State due to active duty
military service. These protections are in place due to the
transient nature of serving in the military, and they allow
servicemembers to avoid the burdens of reestablishing a place
of residence for tax purposes after each permanent change of
duty station.
Public Law (P.L.) 111-97 amended SCRA to extend these same
protections to certain spouses of servicemembers. While the
Committee believes that this extension of protections is
commonsense for military spouses, unfortunately, the law only
benefits the spouses of servicemembers who actually lived in
the same State in which the servicemember established residency
prior to a permanent change of duty station. Therefore, under
current law, spouses who marry a servicemember, after the
servicemember has already been transferred from the State where
they established their residency, cannot claim that same State
as their place of residency. This leaves that spouse having to
legally change his/her State of residency for State and local
income tax purposes after each move, whereas the servicemember
does not have to.
The Committee believes that this discrepancy was not the
intention of P.L. 111-97 and can put an unfair burden on some
military spouses despite the fact that these military families
are facing the same transient lifestyle and undergoing the same
stress as other military families. At a June 23, 2016 full
Committee legislative hearing, Mr. Raymond C. Kelley, Director
of the National Legislative Service of the Veterans of Foreign
Wars of the United States agreed, stating, ``Protecting spouses
of our military from losing residency in their home-of-record,
while also allowing them to elect to have the same residency as
their partner will greatly ease some of the stressors military
families face.''
Section 2 of H.R. 5428 would amend section 511(a)(2) of the
SCRA to allow the spouse of a servicemember to elect to use the
same State of residence as the servicemember for State or local
tax purposes regardless of when or where the two individuals
were married. These changes would apply with respect to any
return of State or local income tax filed for any taxable year
beginning with the taxable year that includes enactment. While
this provision would not require the spouse to claim the same
residence as the servicemember, the Committee believes that
this change in the law would better fulfill the intent of the
SCRA and the protections that are extended to our
servicemembers and their families while they are serving on
active duty.
Section 3. Residence of spouses of servicemembers for voting
The SCRA also protects servicemembers by allowing them to
maintain a certain State of residency or domicile, despite
absence from that State due to military orders, for voting
purposes in Federal, State, or local elections. Allowing them
to continue voting in the State that they consider home
regardless of where the military moves them, benefits the
servicemember similarly as allowing them to maintain the same
State of residence for tax purposes, and alleviates arduous
voter registration requirements on our military men and woman
after each move.
P.L. 111-97 also extended these voting protections to
military spouses after concern that ``[spouses] are
disenfranchised from voting; often times not arriving to a new
state in time to vote in primaries and do not have ample
opportunity to get to know the Federal, state or local
candidates or adequate time to learn their policies and
legislative agendas. It is confusing when one state allows a
military spouse to vote via absentee ballot, yet the state
where the spouse is physically located does not.''\1\
Unfortunately, as was the case with maintaining a certain
residence for tax purposes, this law did not extend these same
voting protections to spouses who marry the servicemember after
the active duty member has already moved from the State in
which they are claiming residence. The Committee believes that
comparable to updating tax forms after each move, updating
voter registration paperwork after each permanent change in
duty station puts an unfair and complicated burden on some
military spouses that is not required for other spouses just
due to when they married the servicemember. The Committee also
believes that spouses and servicemembers should be able to vote
in the same area for which they pay taxes.
---------------------------------------------------------------------------
\1\Senate Report 111-046--Military Spouses Residency Relief Act.
---------------------------------------------------------------------------
Section 3 of H.R. 5428 would amend Section 705(b) of SCRA
by allowing the spouse of a servicemember to elect to use the
same residence as the servicemember for State and local voting
purposes, even if they are absent from that State due to
military orders and regardless of when or where they got
married. The Committee believes that this will fulfill the
intent of SCRA and P.L. 111-97 and lessen the confusion and
burdens of being a military spouse.
Hearings
On June 23, 2016, the full Committee conducted a
legislative hearing on various draft bills and bills introduced
during the 114th Congress, including H.R. 5428. The following
witnesses testified:
The Honorable Doug Lamborn, U.S. House of
Representatives, 5th District of Colorado; The
Honorable Dina Titus, U.S. House of Representatives,
1st District of Nevada; The Honorable Raul Ruiz, U.S.
House of Representatives, 36th District of California;
The Honorable Beto O'Rourke, U.S. House of
Representatives, 16th District of Texas; The Honorable
Ron DeSantis, U.S. House of Representatives, 6th
District of Florida; The Honorable Ted Yoho, U.S. House
of Representatives, 3rd District of Florida; The
Honorable Jody Hice, U.S. House of Representatives,
10th District of Georgia; The Honorable Dan Newhouse,
U.S. House of Representatives, 4th District of
Washington; The Honorable David Young, U.S. House of
Representatives, 3rd District of Iowa; The Honorable
Sloan Gibson, Deputy Secretary, U.S. Department of
Veterans Affairs who was accompanied by Ms. Laura
Eskenazi, Executive in Charge and Vice Chairman, Board
of Veterans Appeals, U.S. Department of Veterans
Affairs, Mr. David McLenachen, Deputy Under Secretary
for Disability Assistance, Veterans Benefits
Administration, U.S. Department of Veterans Affairs,
and Dr. Maureen McCarthy, Assistant Deputy Under
Secretary for Health Patient Care Services, Veterans
Health Administration, U.S. Department of Veterans
Affairs; Mr. Raymond Kelley, Director of the National
Legislative Service, Veterans of Foreign Wars of the
United States; Mr. Paul Varela, Assistant National
Legislative Director, Disabled American Veterans; Mr.
Carl Blake, Associate Executive Director of Government
Relations, Paralyzed Veterans of America; Mr. Louis J.
Celli, Jr., Director of the National Veterans Affairs
and Rehabilitation Division, The American Legion; and
Mr. Rick Weidman, Executive Director for Policy and
Government Affairs, Vietnam Veterans of America.
A Statement for the Record was submitted by the following:
American Battle Monuments Commission; AMVETS; U.S.
Court of Appeals for Veterans Claims; Iraq and
Afghanistan Veterans of America; Military Officers
Association of America; Military Veterans Advocacy,
Inc.; National Organization of Veterans Advocates;
National Veterans Legal Services Program; P.A.W.S.
Foundation; Stetson University College of Law's
Veterans Law Institute; and the U.S. Department of
Labor.
Subcommittee Consideration
There was no Subcommittee consideration of H.R. 5428.
Committee Consideration
On September 21, 2016, the full Committee met in open
markup session, a quorum being present, and ordered H.R. 5428,
favorably reported to the House of Representatives by voice
vote.
A motion by Representative Mark Takano of California to
report H.R. 5428 favorably to the House of Representatives was
agreed to by voice vote.
Committee Votes
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, no recorded votes were taken on
amendments or in connection with ordering H.R. 5428 reported to
the House.
Committee Oversight Findings
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the descriptive portions of this report.
Statement of General Performance Goals and Objectives
In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the Committee's performance
goals and objectives are to ensure that spouses of
servicemembers are able to claim the same state of residence as
the servicemember even if the spouse has not lived in that
state to ensure that, for tax purposes and voting purposes, the
spouse is not negatively impacted by the mobility of active
duty service.
New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee adopts as its
own the estimate of new budget authority, entitlement
authority, or tax expenditures or revenues contained in the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to section 402 of the Congressional
Budget Act of 1974.
Earmarks and Tax and Tariff Benefits
H.R. 5428 does not contain any Congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI of the Rules of the House of
Representatives.
Committee Cost Estimate
The Committee adopts as its own the cost estimate on H.R.
5428, prepared by the Director of the Congressional Budget
Office pursuant to section 402 of the Congressional Budget Act
of 1974.
Congressional Budget Office Cost Estimate
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
for H.R. 5428, provided by the Congressional Budget Office
pursuant to section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 25, 2016.
Hon. Jeff Miller,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 5428, the Military
Residency Choice Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is David Newman.
Sincerely,
Keith Hall.
Enclosure.
H.R. 5428--Military Residency Choice Act
Military personnel can retain their residences or domiciles
for purposes of state and local taxation and voter registration
when they leave a state if that move, and any subsequent moves,
are made in compliance with military orders. Under the Military
Spouses Residency Relief Act, spouses of service members can
retain their states of residency if they move and reside with
the service member; they cannot use the service members' states
of residency for taxation or voting purposes unless they can
independently establish entitlement according to state laws.
H.R. 5428 would allow spouses of service members to claim the
same state of residence as the service member for those
purposes, regardless of whether the spouse had ever resided in
that state.
CBO estimates that enacting H.R. 5428 would have no effect
on the federal budget. Because enacting the legislation would
not affect direct spending or revenues, pay-as-you-go
procedures do not apply.
CBO estimates that enacting H.R. 5428 would not increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2027.
H.R. 5428 contains an intergovernmental mandate as defined
in the Unfunded Mandates Reform Act (UMRA). CBO considers the
residency benefit conferred on military spouses under the
Military Spouses Residency Relief Act to be a preemption of
taxing authority of state and local governments. H.R. 5428
would marginally expand this preemption by allowing the spouses
of service members to elect the residency of a service member
that is not the residence in which the couple was married. CBO
expects that some military spouses would elect new states of
residency if income tax rates in those states are lower.
Although the effect on revenue collections by individual state
and local governments would vary, depending on the number and
income of these individuals and where they reside or are legal
residents, CBO estimates the net effect to be below the annual
threshold established in UMRA ($77 million in 2016, adjusted
annually for inflation).
CBO has determined that section 3 of H.R 5428, which would
allow spouses of military personnel to register to vote in the
same state as the service member, is excluded from review for
mandates under UMRA because it would enforce the constitutional
rights of individuals. Therefore, as specified in UMRA, CBO has
not reviewed the provisions of section 3 for intergovernmental
or private-sector mandates. Other provisions of the bill
contain no private-sector mandates as defined in UMRA.
The CBO staff contacts for this estimate are David Newman
(for federal costs) and Jon Sperl (for private-sector
mandates). The estimate was approved by H. Samuel Papenfuss,
Deputy Assistant Director for Budget Analysis.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates regarding H.R. 5428, prepared by the Director of the
Congressional Budget Office pursuant to section 423 of the
Unfunded Mandates Reform Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act would be created by H.R.
5428.
Statement of Constitutional Authority
Pursuant to Article I, section 8 of the United States
Constitution, H.R. 5428 is authorized by Congress' power to
``provide for the common Defense and general Welfare of the
United States.''
Applicability to Legislative Branch
The Committee finds that H.R. 5428 does not relate to the
terms and conditions of employment or access to public services
or accommodations within the meaning of section 102(b)(3) of
the Congressional Accountability Act.
Statement on Duplication of Federal Programs
Pursuant to section 3(g) of H. Res. 5, 114th Cong. (2015),
the Committee finds that no provision of H.R. 5428 establishes
or reauthorizes a program of the Federal Government known to be
duplicative of another Federal program, a program that was
included in any report from the Government Accountability
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most
recent Catalog of Federal Domestic Assistance.
Disclosure of Directed Rulemaking
Pursuant to section 3(i) of H. Res. 5, 114th Cong. (2015),
the Committee estimates that H.R. 5428 contains no directed
rule making that would require the Secretary to prescribe
regulations.
Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 cites the short title of H.R. 5428 to be the
``Military Residency Choice Act.''
Section 2. Residence of spouses of servicemembers for tax purposes
Section 2(a) would amend Section 511(a)(2) of the
Servicemembers Civil Relief Act (50 U.S.C. 4001(a)(2)) by
adding at the end of the section a new sentence to allow the
spouse of a servicemember to elect to use the same residence as
the servicemember for tax purposes, regardless of the date of
when or where the spouse and the servicemember got married.
Section 2(b) would make the changes made in Section 2(a)
applicable for any return of State or local income tax filed
for any taxable year beginning with the taxable year that
includes the date of enactment.
Section. 3. Residence of spouses of servicemembers for voting
Section 3(a) would amend Section 705(b) of the
Servicemembers Civil Relief Act by striking ``State or local
office'' and all that follows through the period and inserting
a new paragraph which would allow a person who is absent from a
State because the person is accompanying their spouse who is
also absent from that same State due to military or naval
orders shall not, solely by reason of that absence be deemed to
have lost residence or domicile in that state regardless of
whether that person intends to return to that state or gained
residency in any other State. Section 3(a) would also allow for
the spouse of a servicemember to elect to use the same State of
residence as the servicemember regardless of the day on which
they got married.
Section 3(b) would make the changes made in Section 3(a)
effective 90 days following enactment.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
SERVICEMEMBERS CIVIL RELIEF ACT
* * * * * * *
TITLE V--TAXES AND PUBLIC LANDS
* * * * * * *
SEC. 511. RESIDENCE FOR TAX PURPOSES.
(a) Residence or Domicile.--
(1) In general.--A servicemember shall neither lose
nor acquire a residence or domicile for purposes of
taxation with respect to the person, personal property,
or income of the servicemember by reason of being
absent or present in any tax jurisdiction of the United
States solely in compliance with military orders.
(2) Spouses.--A spouse of a servicemember shall
neither lose nor acquire a residence or domicile for
purposes of taxation with respect to the person,
personal property, or income of the spouse by reason of
being absent or present in any tax jurisdiction of the
United States solely to be with the servicemember in
compliance with the servicemember's military orders if
the residence or domicile, as the case may be, is the
same for the servicemember and the spouse. The spouse
of a servicemember may elect to use the same residence
for purposes of taxation as the servicemember
regardless of the date on which the marriage of the
spouse and the servicemember occurred.
(b) Military Service Compensation.--Compensation of a
servicemember for military service shall not be deemed to be
income for services performed or from sources within a tax
jurisdiction of the United States if the servicemember is not a
resident or domiciliary of the jurisdiction in which the
servicemember is serving in compliance with military orders.
(c) Income of a Military Spouse.--Income for services
performed by the spouse of a servicemember shall not be deemed
to be income for services performed or from sources within a
tax jurisdiction of the United States if the spouse is not a
resident or domiciliary of the jurisdiction in which the income
is earned because the spouse is in the jurisdiction solely to
be with the servicemember serving in compliance with military
orders.
(d) Personal Property.--
(1) Relief from personal property taxes.--The
personal property of a servicemember or the spouse of a
servicemember shall not be deemed to be located or
present in, or to have a situs for taxation in, the tax
jurisdiction in which the servicemember is serving in
compliance with military orders.
(2) Exception for property within member's domicile
or residence.--This subsection applies to personal
property or its use within any tax jurisdiction other
than the servicemember's or the spouse's domicile or
residence.
(3) Exception for property used in trade or
business.--This section does not prevent taxation by a
tax jurisdiction with respect to personal property used
in or arising from a trade or business, if it has
jurisdiction.
(4) Relationship to law of state of domicile.--
Eligibility for relief from personal property taxes
under this subsection is not contingent on whether or
not such taxes are paid to the State of domicile.
(e) Increase of Tax Liability.--A tax jurisdiction may not
use the military compensation of a nonresident servicemember to
increase the tax liability imposed on other income earned by
the nonresident servicemember or spouse subject to tax by the
jurisdiction.
(f) Federal Indian Reservations.--An Indian servicemember
whose legal residence or domicile is a Federal Indian
reservation shall be taxed by the laws applicable to Federal
Indian reservations and not the State where the reservation is
located.
(g) Definitions.--For purposes of this section:
(1) Personal property.--The term ``personal
property'' means intangible and tangible property
(including motor vehicles).
(2) Taxation.--The term ``taxation'' includes
licenses, fees, or excises imposed with respect to
motor vehicles and their use, if the license, fee, or
excise is paid by the servicemember in the
servicemember's State of domicile or residence.
(3) Tax jurisdiction.--The term ``tax jurisdiction''
means a State or a political subdivision of a State.
* * * * * * *
TITLE VII--FURTHER RELIEF
* * * * * * *
SEC. 705. GUARANTEE OF RESIDENCY FOR MILITARY PERSONNEL AND SPOUSES OF
MILITARY PERSONNEL.
(a) In General.--For the purposes of voting for any Federal
office (as defined in section 301 of the Federal Election
Campaign Act of 1971 (2 U.S.C. 431)) or a State or local
office, a person who is absent from a State in compliance with
military or naval orders shall not, solely by reason of that
absence--
(1) be deemed to have lost a residence or domicile in
that State, without regard to whether or not the person
intends to return to that State;
(2) be deemed to have acquired a residence or
domicile in any other State; or
(3) be deemed to have become a resident in or a
resident of any other State.
(b) Spouses.--For the purposes of voting for any Federal
office (as defined in section 301 of the Federal Election
Campaign Act of 1971 (2 U.S.C. 431)) or a [State or local
office, a person who is absent from a State because the person
is accompanying the person's spouse who is absent from that
same State in compliance with military or naval orders shall
not, solely by reason of that absence] State or local office--
[(1) be deemed to have lost a residence or domicile
in that State, without regard to whether or not the
person intends to return to that State;
[(2) be deemed to have acquired a residence or
domicile in any other State; or
[(3) be deemed to have become a resident in or a
resident of any other State.]
(1) a person who is absent from a State because the
person is accompanying the person's spouse who is
absent from that same State in compliance with military
or naval orders shall not, solely by reason of that
absence--
(A) be deemed to have lost a residence or
domicile in that State, without regard to
whether or not the person intends to return to
that State;
(B) be deemed to have acquired a residence or
domicile in any other State; or
(C) be deemed to have become a resident in or
a resident of any other State; and
(2) the spouse of a servicemember may elect to use
the same residence as the servicemember regardless of
the date on which the marriage of the spouse and the
servicemember occurred.
* * * * * * *
[all]