Coast Guard combat veterans finally get same tax relief as other branches
H.R. 2973 — Coast Guard Combat-Injured Tax Fairness Act · Filed by Donald Davis (D-NC) · 2 cosponsors · Introduced Apr 21, 2025 · Referred to committee
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What it does
This bill extends a 2016 law that restored improperly withheld taxes from combat-injured veterans' severance payments to include Coast Guard members. The 2016 law applied only when the Coast Guard was under the Department of Defense; this bill adds Coast Guard members under the Department of Homeland Security (and historically under the Department of Transportation) so they receive the same tax relief and refund identification process as other combat-injured veterans.
Why we flagged it
The bill's sole function is to extend an existing 2016 tax-relief mechanism to Coast Guard members previously excluded due to departmental jurisdiction shifts. It is a technical correction to ensure equal treatment of combat-injured veterans across all service branches.
What the text implies
- The bill implicitly acknowledges that Coast Guard members under DHS/DOT were denied tax relief available to other combat-injured veterans for years—a gap that may have affected hundreds of individuals and their families.
- Requires DHS and DOT to identify and report improperly withheld amounts within one year, creating a one-time administrative burden but also a clear deadline for resolving the backlog.
The full analysis lists 3 implications of this text.
Who it affects
Combat-injured Coast Guard veterans are corrected to receive the same tax fairness treatment as other service members—identifying and restoring improperly withheld taxes from their severance. This closes a gap in existing law and harms no one; the only cost is administrative compliance by federal agencies.