In an effort to prevent a lower cost of living adjustment for working-aged military retirees, Sen. Roy Blunt (R-Mo.) cosponsored legislation on Wednesday that would restore the COLA and close a tax loophole to offset the costs.
The Bipartisan Budget Agreement reduces COLA for military retirees who are younger than 62 to one percentage point below the rate of inflation. The provision is scheduled to go into effect in December 2015.
The Keeping our Promise to Our Military Heroes Act, which was introduced by Sen. Kelly Ayotte (R-N.H.), would restore the COLA reduction by requiring individuals to have a Social Security number to qualify for the additional child tax credit.
People who were not authorized to work in the United States received approximately $4.2 billion by claiming the ACTC in 2011, according to the Department of Treasury.
“This bill would easily replace these unfair cuts and help keep our promise to the men and women who bravely serve to protect America in the armed forces,” Blunt said. “I voted against the budget because it hurts our men and women in uniform. This bill is a commonsense solution to help keep our promise to them and to their families.”
The Joint Committee on Taxation estimates Ayotte’s bill would save approximately $20 billion over 10 years.