FOR IMMEDIATE RELEASE
Friday, October 21, 2005

Isakson Co-Sponsors Legislation
to Benefit Deployed Guardsmen, Reservists
Bill Will Ease IRS Rule Requiring Quarterly Tax Returns

WASHINGTON – U.S. Senator Johnny Isakson (R-Ga.) today announced that he will co-sponsor legislation to change an Internal Revenue Service (IRS) ruling that places an excessive burden on the record numbers of Guardsmen and Reservists who have been called into service in Iraq and Afghanistan.

“Since the tragic terrorist attacks of September 11, 2001, our nation has depended on our military Reserves and National Guard like never before in waging the war on terror,” said Isakson, who served in the Georgia Air National Guard. “I find it unacceptable that our tax code further complicates the lives of these brave individuals through burdensome reporting regulations.”

Many employers voluntarily offer "differential pay” when an employee who is a member of the National Guard or Reserve is called to active duty.  These are payments that represent wages the individual would have received if he or she were still performing work for the employer. 

A 36 year-old IRS ruling requires deployed men and women in the Reserves and the National Guard to make quarterly income tax payments if they receive differential pay from their employers. T he Uniformed Services Differential Pay Protection Act amends the IRS code to treat differential wage payments as a regular payment of wages for tax purposes and retirement plans, eliminating the quarterly payment rule for Reserve and Guard members.

During a hearing on Wednesday of the Subcommittee on Employment and Workplace Safety, Isakson, who chairs the subcommittee, praised corporate America for its efforts to accommodate its employees who are serving in the National Guard and Reserves.

“Differential pay is critical to many families who are faced with the loss of income because a wage-earner has been activated for duty in our Guard and Reserve,” Isakson said. “Many of these companies are making tremendous sacrifices for our soldiers, and I want to give them the credit they deserve.”

The legislation was introduced by Senators Judd Gregg (R-N.H.), Pat Roberts (R-Kan.) and Lamar Alexander (R-Tenn.).