For Immediate Release
Office of the Press Secretary
January 23, 2002
Fact Sheet: Victims of Terrorism Tax Relief Act
TODAY'S PRESIDENTIAL ACTION
President Bush today signed the Victims of Terrorism Tax Relief Act -- bipartisan legislation that provides significant income and estate tax relief to the families of victims of terrorism.
The legislation will help the victims of September 11, the Oklahoma City bombing and the recent anthrax attacks.
BACKGROUND ON THE VICTIMS OF TERRORISM TAX RELIEF ACT
Two days after the terrorist attacks of September 11, a bipartisan group of legislators led by House Ways and Means Committee Chairman Bill Thomas introduced H.R. 2884 to provide real tax relief to help the victims' families to recover.
President Bush signaled early support for the legislation, and the Bush Administration worked with Members of Congress from both parties to develop a final bill.
As signed into law by the President today, the Victims of Terrorism Tax Relief Act provides real tax relief to the families of those who died in the September 11 attacks, the Oklahoma City bombing and the anthrax attacks.
Among the many provisions designed to help the families of victims, the new law will:
Provide Real Tax Relief to Victims' Families: The new law waives the income tax liability of a victim who died in one of the attacks for both the year of the attack and the previous year. It ensures that a minimum benefit of $10,000 is provided to the family of each victim.
Exclude Special Death Benefits From Taxation: A number of employers provided death benefits to the families of victims that would have been taxable. The new law provides tax-free treatment of these benefits.
Lower Death Tax Rates for Victims: The new
law shields the first $8.5 million of a victim's estate from the
federal death tax, and protects the first $3 million of the estate from
state death taxes as well. This provision also applies to
the families of the men and women of America's Armed Forces who died in
the line of duty in a combat zone as part of Operation Enduring
Facilitate Charitable Donations to
Victims' Families: The new law facilitates payments by
charitable organizations to victims' families as a result of the
attacks. It also describes how employers can use private
foundations to provide assistance to victims' families.
Eliminate Income Tax on Victims' Debts
Forgiven: Many creditors want to forgive the debts of
victims, such as credit card balances. The new law provides
that this debt forgiveness is not taxable.