The HEART Act

The Heroes Earnings Assistance and Relief Tax Act of 2008 (The HEART Act) provides tax and pension benefits to Service members who are disabled while on active duty for more than 30 days and to their Survivors if they die on active duty.

The HEART Act requires employers and sponsors of qualified defined benefit and defined contribution plans, such as 403(b) arrangements, and section 457(b) education plans to treat Service members as being reemployed by the sponsor company for purposes of entitlement. The purpose of this is to provide Service members and their Survivors for benefits they may not otherwise have been entitled for.

The benefits of the HEART Act depend on the specific benefits of the employer's plan documents and may include:

  • Accelerated vesting in retirement plans
  • Additional life insurance benefits
  • Survivor benefits, such as investment of Death Gratuity and Servicemembers Group Life Insurance (SGLI) payments into Roth IRAs and Coverdell education savings accounts without ordinary limitations