What's happening
This bill changes the tax credit for long-term care insurance premiums in New York to a maximum of $1,000 per policy.
Why it matters
Reduces the generosity of the long-term care insurance tax credit. by capping it at $1,000 per policy, rather than allowing a percentage (previously 20%) of the premium, which could affect the affordability of these policies for those paying higher premiums.
May discourage purchase or renewal of more comprehensive or expensive long-term care policies. since the maximum tax benefit is limited, potentially impacting individuals planning for future health care needs.
Creates more predictability for state budget planning. by setting a clear limit on the tax credit expenditure, helping New York contain costs associated with this tax incentive.
Could particularly impact older adults or those with higher-risk profiles. (who often face higher premiums), making it less financially attractive for them to obtain or maintain long-term care insurance.
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Who cares
Resident taxpayers paying long-term care premiums
The bill would replace the 20% credit with a credit equal to premiums paid, capped at $1,000 per policy, while retaining carryovers for credits exceeding their tax liability.
Business taxpayers paying long-term care premiums
The bill would also replace the 20% credit under the covered business tax provisions with a credit equal to premiums paid, capped at $1,000 per policy.
Long-term care insurers
Premiums would remain eligible only for qualifying policies, with the bill retaining requirements for superintendent approval, minimum standards and federal tax qualification.
Headline styles
Expand Long-Term Care Tax Credit
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to investigations and government operations
- Referred to investigations and government operations
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Expand Long-Term Care Tax Credits
In Assembly Committee · Ways And Means · Sponsor Michael Cusick
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3280
2019-2020 Regular Sessions
IN SENATE
February 5, 2019
Introduced by Sen. LANZA -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
AN ACT to amend the tax law and the insurance law, in relation to the tax credits for premiums paid for long-term care insurance
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivision 1 of section 190 of the tax law, as amended by section 102 of part A of chapter 59 of the laws of 2014, is amended to read as follows:
1. General. A taxpayer shall be allowed a credit not to exceed one thousand dollars for each policy of insurance, against the tax imposed by this article equal to [twenty percent] the amount of the premium paid during the taxable year for long-term care insurance. In order to qualify for such credit, the taxpayer's premium payment must be for the purchase of or for continuing coverage under a long-term care insurance policy that qualifies for such credit pursuant to section one thousand one hundred seventeen of the insurance law.
§ 2. Paragraph (a) of subdivision 14 of section 210-B of the tax law, as added by section 17 of part A of chapter 59 of the laws of 2014, is amended to read as follows:
(a) General. A taxpayer shall be allowed a credit, not to exceed one thousand dollars for each policy of insurance, against the tax imposed by this article equal to [twenty percent] the amount of the premium paid during the taxable year for long-term care insurance. In order to qualify for such credit, the taxpayer's premium payment must be for the purchase of or for continuing coverage under a long-term care insurance policy that qualifies for such credit pursuant to section one thousand one hundred seventeen of the insurance law.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06655-01-9
S. 3280 2
§ 3. Paragraph 1 of subsection (aa) of section 606 of the tax law, as amended by section 1 of part P of chapter 61 of the laws of 2005, is amended to read as follows:
(1) Residents. A taxpayer shall be allowed a credit, not to exceed one thousand dollars for each policy of insurance, against the tax imposed by this article equal to [twenty percent] the amount of the premium paid during the taxable year for long-term care insurance. In order to qualify for such credit, the taxpayer's premium payment must be for the purchase of or for continuing coverage under a long-term care insurance policy that qualifies for such credit pursuant to section one thousand one hundred seventeen of the insurance law. If the amount of the credit allowable under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years.
§ 4. Paragraph 1 of subdivision (m) of section 1511 of the tax law, as amended by section 21 of part B of chapter 58 of the laws of 2004, is amended to read as follows:
(1) A taxpayer shall be allowed a credit, not to exceed one thousand dollars for each policy of insurance, against the tax imposed by this article equal to [twenty percent] the amount of the premium paid during the taxable year for long-term care insurance. In order to qualify for such credit, the taxpayer's premium payment must be for the purchase of or for continuing coverage under a long-term care insurance policy that qualifies for such credit pursuant to section one thousand one hundred seventeen of the insurance law.
§ 5. Paragraph 1 of subsection (g) of section 1117 of the insurance law, as amended by chapter 417 of the laws of 2001, is amended to read as follows:
(1) Except for certain group contracts described in paragraph four of this subsection, in order for premium payments for long-term care insurance to qualify for purposes of section one hundred ninety, subdivision [twenty-five-a] fourteen of section two hundred [ten] ten-B, subsection (aa) of section six hundred six[, subsection (k) of section one thousand four hundred fifty-six] and subsection (m) of section one thousand five hundred eleven of the tax law, the long-term care insurance must be approved by the superintendent pursuant to this subsection. Prior to approving any such insurance, the superintendent shall conclude that it meets minimum standards, including minimum loss ratio standards under this section or section three thousand two hundred twenty-nine of this chapter and is a qualified long-term care insurance contract as defined in section 7702B of the internal revenue code.
§ 6. This act shall take effect on the first of January next succeeding the date on which it shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the tax law and the insurance law, in relation to the tax credits for premiums paid for long-term care insurance
Purpose
Provides that the tax credits for long-term health care insurance shall be up to $1,000 of the premiums paid for each policy of such insurance.
Summary of provisions
Section one amends subdivision 1 of section 190 of the tax law, as amended by section 102 of part A of chapter 59 of the laws of 2014
Section two amends paragraph (a) of subdivision 14 of section 210-B of the tax law, as added by section 17 of part A of chapter 59 of the laws of 2014
Section three amends paragraph 1 of subsection (aa) of section 606 of the tax law, as amended by section 1 of part p of chapter 61 of the laws of 2005
Section four amends paragraph 1 of subdivision (m) of section 1511 of the tax law, as amended by section 21 of part B of the laws 2004
Section five amends paragraph 1 of subsection (g) of section 1117 of the insurance law, as amended by chapter 417 of the laws of 2001
Section six is the effective date.
Justification
Recently, many senior citizens who are on fixed incomes received notices that their long term health insurance premiums were going up as much as 48% to 60%. If these premiums are not paid, the policy that they have been paying for for years will be canceled. These insurance policies were taken out to ensure that their needs would be met in case they had to go into a long term care facility when they got older. This bill will help reduce some of the recent premium increase and give seniors the help they need to keep their long term care policy in good standing.
Legislative history
2018: S.6168 - Referred to Investigations & Government Operations / A.8196 - Referred to Ways & Means 2017: S.6168 - Passed Senate / A.8196 - Referred to Ways & Means 2016: S.6697 - Committed to Finance / A.9314 - Referred to Ways & Means
Fiscal implications
None to the State.
Effective date
This act shall take effect on the first of January next succeeding the date on which it shall have become a law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.