A bill introduced on Thursday in the House of Representatives would remove pension cuts to military retirees in the budget agreement passed this week and offset the fiscal difference by closing of a loophole that allows illegal immigrants to receive tax credits.

Reps. Mike Fitzpatrick (R., Pa.) and Martha Roby (R., Ala.) introduced H.R. 3788 to replace a controversial provision in the bipartisan budget deal that hits military retirees with a 1 percent decrease in their annual cost-of-living adjustment (COLA) but left civilian federal retirees untouched.

Disabled military retirees are not exempt from the cuts that could cost servicemembers as much as $124,000 over the course of their retirement.

Sen. Jeff Sessions (R., Ala.) attempted on Tuesday to stop the cuts by offering an amendment to close the loophole in the Refundable Child Tax Credit, which the Treasury Inspector General for Tax Administration (TIGTA) says provides incentives for aliens to enter the country illegally. Senate Democrats blocked the amendment.

"This nation desperately needs a return to fiscal normalcy and bipartisan cooperation. While the Bipartisan Budget Act is a step in that direction, it does so partly on the backs of our brave military veterans," Fitzpatrick said in a statement. "What I’ve done is introduce a bill to remove that burden from our military retirees and replace it with common sense reforms to the Child Tax Credit program."

The bill would require the inclusion of a taxpayer’s Social Security number in order to be eligible for tax refunds. Illegal aliens currently use identification numbers obtained from the IRS to file tax returns and claim the Additional Child Tax Credit (ACTC), according to TIGTA.

The change could save $7 billion over 10 years, according to the Joint Tax Commission, more than enough to offset the pension cuts to the military that House Budget Committee Chairman Paul Ryan (R., Wis.) says will save $6 billion.

"Stopping fraud and abuse within the federal government is something we should all agree on—especially when using those dollars to help honor our pledges to our veterans," Fitzpatrick said. "This bill does that while still keeping a commitment to responsible budgeting."

"Just look at the vast federal government that is rife with waste," Roby said. "Are reductions to military benefits really the best place for Congress to make cuts? I don’t think so, and that’s why I believe that provision should be removed."

The bill already has 45 cosponsors, including Georgia Democrat John Barrow.

Roby said she hopes the bill will be the first item on the agenda when Congress reconvenes in 2014.

"I believe that this is a fix the Republican Conference can rally around," she said. "I have personally contacted the House leadership this morning to give voice to the concerns of military retirees in my district who feel singled out by the budget agreement."

"I am strongly encouraging our leaders to use the Christmas week as an opportunity to build support for this or similar legislation so that we can pass it upon our return in January," Roby said. "In my opinion, it should be the first item on the docket for 2014."

Col. Daniel L. Rubini (Ret.) told Fitzpatrick that he fully supports the bill, saying, "This is but one highly desirable step to take to keep the promise made to our soldiers."

"Get the fraud out of the system, and put the money in the hands of our soldiers who have sacrificed so much," he said. "They have given to this country more than any other segment of our citizenry."