Coast Guard Combat-Injured Tax Fairness Act

This bill amends the Combat-Injured Veterans Tax Fairness Act of 2016 to extend its provisions to members of the Coast Guard. Its primary purpose is to ensure that severance payments for combat-related injuries to Coast Guard veterans are not improperly taxed, regardless of whether the Coast Guard was operating under the Department of Homeland Security or the Department of Transportation. The legislation mandates that the Secretary of Homeland Security and the Secretary of Transportation identify and report any amounts improperly withheld from Coast Guard members' severance pay within one year of the bill's enactment. Furthermore, these Secretaries are required to ensure that such improper withholdings do not occur in the future, providing equitable tax treatment for all combat-injured veterans. This ensures that Coast Guard members receive the same tax fairness as other service members.