September 22, 2010

Senate Finance Committee Hears Veterans’ Troubles

Testimony reflects complex financial, tax woes of military personnel

At a hearing before the Senate Committee on Finance on Wednesday, military personnel testified about some of the complex financial hardships facing them, their families and their employers.

Opening statements from Sens. Max Baucus, D-Mont., and Chuck Grassley, D-Iowa, indicated awareness that military personnel and their families, and the small businesses that employ them, are subject to tax and economic difficulties that, even in these tough times, extend beyond those of the general public.

Testimony from a small business owner, active duty and retired servicemen, a representative from a coalition of military groups and associations and the director of state family programs for the Montana National Guard all testified about the difficulties encountered by those they represented, then made suggestions for changes in existing laws or for entirely new programs to assist the military community and its support system.

Some of the problems they pointed out included the following:

  • National Guard members who are not eligible for reimbursement because of distance or income limitations often end up paying the entire cost out of pocket, and indeed can lose money not just in training but when deployed
  • Surviving children of service members killed in action, whose surviving parent has assigned Survivor Benefit Plan benefits to them, can end up caught by the Alternative Minimum Tax
  • Small businesses not only find it difficult to carry service members on their books for extended deployments, they also often have trouble assisting returning employees in re-assimilating into their former positions
  • Service members are often passed over for jobs upon their return due to fears of redeployment, or cannot reactivate their small businesses because of loss of clients.

The complexities of the issues faced by the military community and its employers require additional actions and support. While a number of solutions were proposed or recommended by those testifying, whether any will be acted on before the October recess remains to be seen.

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