S. 5445: GRACE for Military Survivors Act

This bill would give more time to contribute certain military death benefit payments into Roth IRAs and Coverdell education savings accounts.

What changes

Under current law, a surviving family member generally has 1 year to roll over eligible military death benefits into these accounts. This bill would extend that window to 3 years.

Who it applies to

The bill applies to amounts received under two federal benefit programs tied to military deaths:

• benefits under Title 10 of the U.S. Code, and
• benefits under Title 38 of the U.S. Code.

Timing

The change would generally apply to eligible amounts received on or after the date the bill is enacted. It would also allow some earlier contributions to qualify for the expanded time period, going back to amounts received after October 7, 2001, if the contribution is made within the new deadline rules described in the bill.

Practical effect

In plain terms, the bill would give eligible military survivors a longer period to decide whether to put these death benefit funds into a Roth IRA or a Coverdell education savings account, instead of having to act within one year.

Relevant Companies

None found