S 2121
110th CONGRESS
1st Session
S. 2121
To provide funding and incentives for caregiver support and
long-term care assistance.
IN THE SENATE OF THE UNITED STATES
October 1, 2007
Mr. MENENDEZ (for himself, Mr. LAUTENBERG, and Mr. DURBIN) introduced
the following bill; which was read twice and referred to the Committee
on Finance
A BILL
To provide funding and incentives for caregiver support and
long-term care assistance.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Caregiver Assistance and Relief Effort
Act of 2007' or as the `CARE Act of 2007'.
SEC. 2. INCREASED FUNDING FOR NATIONAL FAMILY CAREGIVER SUPPORT PROGRAM.
(a) In General- Section 303(e) of the Older Americans Act of 1965 (42
U.S.C. 3023(e)) is amended--
(1) in paragraph (1), by striking `$160,000,000' and all that follows
and inserting `$250,000,000 for fiscal year 2008.'; and
(2) in paragraph (2), by striking `$166,500,000' and all that follows
and inserting `$250,000,000 for each of fiscal years 2009 through
2011.'.
(b) Native Americans- Section 643(2) of the Older Americans Act of 1965
(42 U.S.C. 3057n(2)) is amended by striking `$6,500,000' and all that
follows and inserting `$10,000,000 for each of fiscal years 2008 through
2011.'.
SEC. 3. CREDIT FOR TAXPAYERS WITH LONG-TERM CARE NEEDS.
(a) In General- Subpart C of part IV of subchapter A of chapter 1 of
the Internal Revenue Code of 1986 (relating to refundable credits) is
amended by redesignating section 36 as section 37 and by inserting after
section 35 the following new section:
`SEC. 36. CREDIT FOR TAXPAYERS WITH LONG-TERM CARE NEEDS.
`(a) Allowance of Credit-
`(1) IN GENERAL- There shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount equal to the
applicable amount multiplied by the number of applicable individuals
with respect to whom the taxpayer is an eligible caregiver for the
taxable year.
`(2) APPLICABLE AMOUNT- For purposes of paragraph (1), the applicable
amount shall be determined in accordance with the following table:
`
---------------------------
---------------------------
2008 $2,500
2009 $2,750
2010 or thereafter $3,000.
---------------------------
`(b) Limitation Based on Adjusted Gross Income-
`(1) IN GENERAL- The amount of the credit allowable under subsection
(a) shall be reduced (but not below zero) by $100 for each $1,000
(or fraction thereof) by which the taxpayer's modified adjusted gross
income exceeds the threshold amount. For purposes of the preceding
sentence, the term `modified adjusted gross income' means adjusted
gross income increased by any amount excluded from gross income under
section 911, 931, or 933.
`(2) THRESHOLD AMOUNT- For purposes of paragraph (1), the term `threshold
amount' means $75,000 (twice such amount in the case of joint return).
`(3) INDEXING- In the case of any taxable year beginning in a calendar
year after 2008, the $75,000 amount contained in paragraph (2) shall
be increased by an amount equal to the product of--
`(A) such dollar amount, and
`(B) the medical care cost adjustment determined under section 213(d)(10)(B)(ii)
for the calendar year in which the taxable year begins, determined
by substituting `2007' for `1996' in subclause (II) thereof.
If any increase determined under the preceding sentence is not a multiple
of $50, such increase shall be rounded to the next lowest multiple
of $50.
`(c) Definitions- For purposes of this section--
`(1) APPLICABLE INDIVIDUAL-
`(A) IN GENERAL- The term `applicable individual' means, with respect
to any taxable year, any individual who has been certified, before
the due date for filing the return of tax for the taxable year (without
extensions), by a physician (as defined in section 1861(r)(1) of
the Social Security Act) as being an individual with long-term care
needs described in subparagraph (B) for a period--
`(i) which is at least 180 consecutive days, and
`(ii) a portion of which occurs within the taxable year.
Such term shall not include any individual otherwise meeting the
requirements of the preceding sentence unless within the 39 1/2
month period ending on such due date (or such other period as the
Secretary prescribes) a physician (as so defined) has certified
that such individual meets such requirements.
`(B) INDIVIDUALS WITH LONG-TERM CARE NEEDS- An individual is described
in this subparagraph if the individual meets any of the following
requirements:
`(i) The individual is at least 18 years of age and--
`(I) is unable to perform (without substantial assistance from
another individual) at least 3 activities of daily living (as
defined in section 7702B(c)(2)(B)) due to a loss of functional
capacity, or
`(II) requires substantial supervision to protect such individual
from threats to health and safety due to severe cognitive impairment
and is unable to perform at least 1 activity of daily living
(as so defined) or to the extent provided in regulations prescribed
by the Secretary (in consultation with the Secretary of Health
and Human Services), is unable to engage in age appropriate
activities.
`(ii) The individual is at least 6 but not 18 years of age and--
`(I) is unable to perform (without substantial assistance from
another individual) at least 3 activities of daily living (as
defined in section 7702B(c)(2)(B)) due to a loss of functional
capacity,
`(II) requires substantial supervision to protect such individual
from threats to health and safety due to severe cognitive impairment
and is unable to perform at least 1 activity of daily living
(as so defined) or to the extent provided in regulations prescribed
by the Secretary (in consultation with the Secretary of Health
and Human Services), is unable to engage in age appropriate
activities,
`(III) has a level of disability similar to the level of disability
described in subclause (I) (as determined under regulations
promulgated by the Secretary), or
`(IV) has a complex medical condition (as defined by the Secretary)
that requires medical management and coordination of care.
`(iii) The individual is at least 2 but not 6 years of age and--
`(I) is unable due to a loss of functional capacity to perform
(without substantial assistance from another individual) at
least 2 of the following activities: eating, transferring, or
mobility,
`(II) has a level of disability similar to the level of disability
described in subclause (I) (as determined under regulations
promulgated by the Secretary), or
`(III) has a complex medical condition (as defined by the Secretary)
that requires medical management and coordination of care.
`(iv) The individual is under 2 years of age and--
`(I) requires specific durable medical equipment by reason of
a severe health condition or requires a skilled practitioner
trained to address the individual's condition to be available
if the individual's parents or guardians are absent,
`(II) has a level of disability similar to the level of disability
described in subclause (I) (as determined under regulations
promulgated by the Secretary), or
`(III) has a complex medical condition (as defined by the Secretary)
that requires medical management and coordination of care.
`(v) The individual has 5 or more chronic conditions (as defined
in subparagraph (C)) and is unable to perform (without substantial
assistance from another individual) at least 1 activity of daily
living (as so defined) due to a loss of functional capacity.
`(C) CHRONIC CONDITION- For purposes of this paragraph, the term
`chronic condition' means a condition that lasts for at least 6
consecutive months and requires ongoing medical care.
`(2) ELIGIBLE CAREGIVER- A taxpayer shall be treated as an eligible
caregiver for any taxable year with respect to the taxpayer and the
taxpayer's spouse and dependents. A taxpayer shall not be treated
as an eligible caregiver with respect to himself for any taxable year
beginning in any calendar year if any other person is an eligible
caregiver with respect to the taxpayer for a taxable year which begins
in such calendar year.
`(d) Identification Requirement- No credit shall be allowed under this
section to a taxpayer with respect to any applicable individual unless
the taxpayer includes the name and taxpayer identification number of
such individual, and the identification number of the physician certifying
such individual, on the return of tax for the taxable year.
`(e) Taxable Year Must Be Full Taxable Year- Except in the case of a
taxable year closed by reason of the death of the taxpayer, no credit
shall be allowable under this section in the case of a taxable year
covering a period of less than 12 months.'.
(b) Conforming Amendments-
(1) Section 6213(g)(2) of the Internal Revenue Code of 1986 is amended
by striking `and' at the end of subparagraph (L), by striking the
period at the end of subparagraph (M) and inserting `, and', and by
inserting after subparagraph (M) the following new subparagraph:
`(N) an omission of a correct TIN or physician identification required
under section 36(d) (relating to credit for taxpayers with long-term
care needs) to be included on a return.'.
(2) The table of sections for subpart C of part IV of subchapter A
of chapter 1 of such Code is amended by redesignating the item relating
to section 36 as an item relating to section 37 and by inserting before
such item the following new item:
`Sec. 36. Credit for taxpayers with long-term care needs.'.
(3) Section 1324(b)(2) of title 31, United States Code, is amended
by inserting `or 36' after `section 35'.
(c) Effective Date- The amendments made by this section shall apply
to taxable years beginning after December 31, 2007.
SEC. 4. TREATMENT OF PREMIUMS ON QUALIFIED LONG-TERM CARE INSURANCE
CONTRACTS.
(a) In General- Part VII of subchapter B of chapter 1 of the Internal
Revenue Code of 1986 (relating to additional itemized deductions) is
amended by redesignating section 224 as section 225 and by inserting
after section 223 the following new section:
`SEC. 224. PREMIUMS ON QUALIFIED LONG-TERM CARE INSURANCE CONTRACTS.
`(a) In General- In the case of an individual, there shall be allowed
as a deduction an amount equal to the applicable percentage of the amount
of eligible long-term care premiums (as defined in section 213(d)(10))
paid during the taxable year for coverage for the taxpayer and the taxpayer's
spouse and dependents under a qualified long-term care insurance contract
(as defined in section 7702B(b)).
`(b) Applicable Percentage- For purposes of subsection (a)--
`(1) IN GENERAL- Except as otherwise provided in this subsection,
the applicable percentage shall be determined in accordance with the
following table based on the number of years of continuous coverage
(as of the close of the taxable year) of the individual under any
qualified long-term care insurance contracts (as defined in section
7702B(b)):
`If the number of years of
--The applicable
continuous coverage is--
--percentage is--
--60
At least 1 but less than 2
--70
At least 2 but less than 3
--80
At least 3 but less than 4
--90
--100.
`(2) SPECIAL RULES FOR INDIVIDUALS WHO HAVE ATTAINED AGE 55- In the
case of an individual who has attained age 55 as of the close of the
taxable year, the following table shall be substituted for the table
in paragraph (1):
`If the number of years of
--The applicable
continuous coverage is--
--percentage is--
--70
At least 1 but less than 2
--85
--100.
`(3) ONLY COVERAGE AFTER 2007 TAKEN INTO ACCOUNT- Only coverage for
periods after December 31, 2007, shall be taken into account under
this subsection.
`(4) CONTINUOUS COVERAGE- An individual shall not fail to be treated
as having continuous coverage if the aggregate breaks in coverage
during any 1-year period are less than 60 days.
`(c) Coordination With Other Deductions- Any amount paid by a taxpayer
for any qualified long-term care insurance contract to which subsection
(a) applies shall not be taken into account in computing the amount
allowable to the taxpayer as a deduction under section 162(l) or 213(a).'.
(b) Conforming Amendments-
(1) Section 62(a) of the Internal Revenue Code of 1986 is amended
by inserting before the last sentence the following new paragraph:
`(22) PREMIUMS ON QUALIFIED LONG-TERM CARE INSURANCE CONTRACTS- The
deduction allowed by section 224.'.
(2) The table of sections for part VII of subchapter B of chapter
1 of such Code is amended by redesignating the item relating to section
224 as an item relating to section 225 and by inserting before such
item the following new item:
`Sec. 224. Premiums on qualified long-term care insurance contracts.'.
(c) Effective Date- The amendments made by this section shall apply
to taxable years beginning after December 31, 2007.
SEC. 5. ADDITIONAL CONSUMER PROTECTIONS FOR LONG-TERM CARE INSURANCE.
(a) Additional Protections Applicable to Long-Term Care Insurance- Subparagraphs
(A) and (B) of section 7702B(g)(2) of the Internal Revenue Code of 1986
(relating to requirements of model regulation and Act) are amended to
read as follows:
`(A) IN GENERAL- The requirements of this paragraph are met with
respect to any contract if such contract meets--
`(i) MODEL REGULATION- The following requirements of the model
regulation:
`(I) Section 6A (relating to guaranteed renewal or noncancellability),
other than paragraph (5) thereof, and the requirements of section
6B of the model Act relating to such section 6A.
`(II) Section 6B (relating to prohibitions on limitations and
exclusions) other than paragraph (7) thereof.
`(III) Section 6C (relating to extension of benefits).
`(IV) Section 6D (relating to continuation or conversion of
coverage).
`(V) Section 6E (relating to discontinuance and replacement
of policies).
`(VI) Section 7 (relating to unintentional lapse).
`(VII) Section 8 (relating to disclosure), other than sections
8F, 8G, 8H, and 8I thereof.
`(VIII) Section 11 (relating to prohibitions against post-claims
underwriting).
`(IX) Section 12 (relating to minimum standards).
`(X) Section 13 (relating to requirement to offer inflation
protection).
`(XI) Section 25 (relating to prohibition against preexisting
conditions and probationary periods in replacement policies
or certificates).
`(XII) The provisions of section 26 relating to contingent nonforfeiture
benefits, if the policyholder declines the offer of a nonforfeiture
provision described in paragraph (4).
`(ii) MODEL ACT- The following requirements of the model Act:
`(I) Section 6C (relating to preexisting conditions).
`(II) Section 6D (relating to prior hospitalization).
`(III) The provisions of section 8 relating to contingent nonforfeiture
benefits, if the policyholder declines the offer of a nonforfeiture
provision described in paragraph (4).
`(B) DEFINITIONS- For purposes of this paragraph--
`(i) MODEL PROVISIONS- The terms `model regulation' and `model
Act' mean the long-term care insurance model regulation, and the
long-term care insurance model Act, respectively, promulgated
by the National Association of Insurance Commissioners (as adopted
as of October 2000).
`(ii) COORDINATION- Any provision of the model regulation or model
Act listed under clause (i) or (ii) of subparagraph (A) shall
be treated as including any other provision of such regulation
or Act necessary to implement the provision.
`(iii) DETERMINATION- For purposes of this section and section
4980C, the determination of whether any requirement of a model
regulation or the model Act has been met shall be made by the
Secretary.'.
(b) Excise Tax- Paragraph (1) of section 4980C(c) of the Internal Revenue
Code of 1986 (relating to requirements of model provisions) is amended
to read as follows:
`(1) REQUIREMENTS OF MODEL PROVISIONS-
`(A) MODEL REGULATION- The following requirements of the model regulation
must be met:
`(i) Section 9 (relating to required disclosure of rating practices
to consumer).
`(ii) Section 14 (relating to application forms and replacement
coverage).
`(iii) Section 15 (relating to reporting requirements).
`(iv) Section 22 (relating to filing requirements for marketing).
`(v) Section 23 (relating to standards for marketing), including
inaccurate completion of medical histories, other than paragraphs
(1), (6), and (9) of section 23C.
`(vi) Section 24 (relating to suitability).
`(vii) Section 29 (relating to standard format outline of coverage).
`(viii) Section 30 (relating to requirement to deliver shopper's
guide).
The requirements referred to in clause (vi) shall not include those
portions of the personal worksheet described in appendix B relating
to consumer protection requirements not imposed by section 4980C
or 7702B.
`(B) MODEL ACT- The following requirements of the model Act must
be met:
`(i) Section 6F (relating to right to return).
`(ii) Section 6G (relating to outline of coverage).
`(iii) Section 6H (relating to requirements for certificates under
group plans).
`(iv) Section 6J (relating to policy summary).
`(v) Section 6K (relating to monthly reports on accelerated death
benefits).
`(vi) Section 7 (relating to incontestability period).
`(C) DEFINITIONS- For purposes of this paragraph, the terms `model
regulation' and `model Act' have the meanings given such terms by
section 7702B(g)(2)(B).'.
(c) Effective Date- The amendments made by this section shall apply
to policies issued more than 1 year after the date of the enactment
of this Act.
END
