A bill to exclude from Federal income taxation amounts received in settlement of refund claims for State or local income taxes on Federal retirement benefits which were not subject to State or local income taxation on the same basis as State or local retirement benefits.
The source supplies the latest action, but no lifecycle stage.
Latest action (30 Jun 1994): Read twice and referred to the Committee on Finance.
What this bill does
S. 2256 would amend the Internal Revenue Code to exclude from federal taxable income any payments—including interest—that individuals receive from a state government in settlement of claims for refunds of state income taxes. This exclusion would apply specifically to refunds tied to state taxes improperly imposed on federal retirement benefits before January 1, 1990, in a manner inconsistent with the Supreme Court's 1989 ruling in Davis v. Michigan Department of the Treasury. That decision addressed situations where states taxed federal retirement benefits differently than they taxed comparable state or local government retirement benefits. The bill would apply only to settlement payments received after December 31, 1994.
The bill would primarily affect retired federal employees who had previously overpaid state or local income taxes on their federal retirement benefits due to unequal tax treatment compared to state and local retirees, and who subsequently received refunds or settlements from state or local governments for those overpayments. Under this bill, such settlement payments would not be counted as taxable income for federal tax purposes, potentially increasing the net financial benefit these retirees receive from their refunds.
The bill was introduced in the Senate on June 30, 1994, by Senator Charles Robb of Virginia and referred to the Senate Committee on Finance. It did not receive a vote and did not advance further during the 103rd Congress.
Plain-English summary generated by Bill100 AI from the official record. Always verify against the source below.
Official summary
Amends the Internal Revenue Code to exclude from gross income any amount received after December 31, 1994, from a State in settlement of a claim for a refund of State income taxes attributable to the taxation of any protected retirement benefit of an officer or employee of the United States paid before January 1, 1990.
Timeline
30 Jun 1994
Read twice and referred to the Committee on Finance.
Common questions
- What does S. 2256 do?
- S. 2256 would amend the Internal Revenue Code to exclude from federal taxable income any payments—including interest—that individuals receive from a state government in settlement of claims for refunds of state income taxes. This exclusion would apply specifically to refunds tied to state taxes improperly imposed on federal retirement benefits before January 1, 1990, in a manner inconsistent with the Supreme Court's 1989 ruling in Davis v. Michigan Department of the Treasury. That decision addressed situations where states taxed federal retirement benefits differently than they taxed comparable state or local government retirement benefits. The bill would apply only to settlement payments received after December 31, 1994. The bill would primarily affect retired federal employees who had previously overpaid state or local income taxes on their federal retirement benefits due to unequal tax treatment compared to state and local retirees, and who subsequently received refunds or settlements from state or local governments for those overpayments. Under this bill, such settlement payments would not be counted as taxable income for federal tax purposes, potentially increasing the net financial benefit these retirees receive from their refunds. The bill was introduced in the Senate on June 30, 1994, by Senator Charles Robb of Virginia and referred to the Senate Committee on Finance. It did not receive a vote and did not advance further during the 103rd Congress.
- Has S. 2256 become law?
- The source does not supply a confirmed lifecycle stage for S. 2256. Check the latest action and official source below.
- Who sponsored S. 2256?
- S. 2256 was sponsored by Sen. Robb, Charles S. [D-VA] (D-VA), with 0 cosponsors.
- What's the latest action on S. 2256?
- Read twice and referred to the Committee on Finance. (30 Jun 1994).
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