November 20, 2025
Mr. Ricketts introduced the following bill; which was read twice and referred to the Committee on Finance
To amend the Internal Revenue Code of 1986 to exempt certain income of active or reserve service members from tax.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
Section 1. Short title
This Act may be cited as the Service Members Tax Relief Act
.
Sec. 2. Exemption from income tax for uniformed service members
(a) In general
Part III of subchapter B of chapter 1 of subtitle A of the Internal Revenue Code of 1986 is amended by inserting after section 139L the following new section:
139M. Certain income earned by uniformed service members
(a) In general
Gross income shall not include any compensation received by an individual in connection with such individual’s service during the taxable year as an active or reserve member of the Uniformed Services of the United States.
(b) Exclusion of retirement income
For purposes of this section, the term
compensationdoes not include any pension or retirement pay.
(b) Clerical amendment
The table of sections for part III of subchapter B of chapter 1 of subtitle A of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 139L the following new item:
(c) Effective date
The amendments made by this section shall apply to income earned in taxable years beginning after the date of the enactment of this Act.