Ayotte Votes to Start Debate on Repealing Military Retirement Cuts

Press Release

WASHINGTON, D.C. - With the Senate set to take up legislation to repeal unfair cuts to military retirement benefits, U.S. Senator Kelly Ayotte (R-NH) announced she will offer an amendment that would pay for a full repeal of the Cost of Living Allowance (COLA) reduction for military retirees that was included in December's budget deal - which she voted against. Ayotte voted today to start debate on underlying legislation to repeal the cuts.

"These unfair cuts never should have been passed into law in the first place, and both parties agree that we need to fix this now," said Ayotte. "This proposal - which I've modified to address concerns I've heard from my Democratic colleagues - is a good government measure that would end an egregious abuse of our tax code and save billions of taxpayer dollars. I urge my colleagues on both sides of the aisle to support it."

Ayotte's proposal would require that filers claiming the Additional Child Tax Credit (ACTC) include a valid Social Security Number (SSN) for each child they are claiming. This language is similar to a previous proposal introduced by Senator Ayotte - but it requires a valid SSN for the child, rather than the filer. In January, Ayotte modified her proposal in response to concerns raised by Senate Democrats and introduced the revised legislation as a stand-alone bill - the Honor Our Promise Act (S. 1977). The Joint Committee on Taxation estimates that this change would save approximately $20 billion over 10 years.

S. 1977 has been endorsed by the American Legion, American Veterans (AMVETS), Concerned Veterans for America (CVA), the Military Officers Association of America (MOAA), the National Guard Association of America (NGAUS), the National Military Family Association (NMFA), the Naval Enlisted Reserve Association (NERA), the U.S. Army Warrant Officers Association, the U.S. Coast Guard Chief Petty Officers Association, and the U.S. Coast Guard Enlisted Association.

During consideration of the budget agreement in December, Ayotte led the fight against a provision in the legislation that unfairly targeted military retirees by requiring a one percent annual reduction in their COLA. Ayotte initially introduced a COLA fix, the Keeping Our Promise to Our Military Heroes Act (S. 1869), in December immediately following passage of the budget deal (which she opposed).

In 2011, the Treasury Department's Inspector General reported that individuals who were not authorized to work in the U.S. received billions by claiming the ACTC, and several news investigations have found troubling instances of abuse of this tax credit. In just one example, according to a 2012 news report, an undocumented worker in Indiana admitted that his address was used to file tax returns by four other undocumented workers, who fraudulently claimed 20 children in total - resulting in tax refunds totaling nearly $30,000.

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