109th CONGRESS
2d Session
H. R. 6211
To amend the Internal Revenue Code of 1986 to allow individuals
a deduction for qualified long-term care insurance premiums, a credit for
individuals who care for those with long-term care needs, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
September 27, 2006
Ms. HERSETH introduced the following bill; which was referred to the Committee
on Ways and Means, and in addition to the Committee on Education and the
Workforce, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the jurisdiction
of the committee concerned
A BILL
To amend the Internal Revenue Code of 1986 to allow individuals
a deduction for qualified long-term care insurance premiums, a credit for
individuals who care for those with long-term care needs, and for other
purposes.
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 `Comprehensive Long-Term Care Support Act of
2006'.
SEC. 2. FINDINGS.
The Congress hereby finds:
(1) As our Nation's seniors live longer lives, the United States faces
a major challenge in long-term health care needs.
(2) The United States does not have a comprehensive system to support
long-term care needs.
(3) Eighty-six percent of people age 85 and older have at least one chronic
condition which can cause pain, disability, and loss of functioning.
(4) Long-term care is expected to place a huge burden on State Medicaid
programs, which are the primary source of funding for nursing homes.
SEC. 3. DEDUCTION FOR QUALIFIED LONG-TERM CARE INSURANCE PREMIUMS.
(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 or any member of the
family of the taxpayer under a qualified long-term care insurance contract
(as defined in section 7702B(b)).
`(b) Applicable Percentage- For purposes of subsection (a), the applicable
percentage shall be determined in accordance with the following table:
`For taxable years beginning
The applicable
in calendar year:
percentage is:
2007
--50
2008
--75
2009 or thereafter
--100.
`(c) Member of the Family- For purposes of this section, the term `member
of the family' means, with respect to any individual--
`(1) the spouse of the individual,
`(2) an ancestor or lineal descendant of the individual or the individual's
spouse,
`(3) a brother or sister of the individual or any individual described
in paragraph (1) or (2), and
`(4) the spouse of any individual described in paragraph (2) or (3).
`(d) 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) Long-Term Care Insurance Permitted to Be Offered Under Cafeteria Plans
and Flexible Spending Arrangements-
(1) CAFETERIA PLANS- Section 125(f) of the Internal Revenue Code of 1986
(defining qualified benefits) is amended by inserting before the period
at the end `; except that such term shall include the payment of premiums
for any qualified long-term care insurance contract (as defined in section
7702B) to the extent the amount of such payment does not exceed the eligible
long-term care premiums (as defined in section 213(d)(10)) for such contract'.
(2) FLEXIBLE SPENDING ARRANGEMENTS- Section 106 of such Code (relating
to contributions by an employer to accident and health plans) is amended
by striking subsection (c).
(c) Conforming Amendments-
(1) Section 62(a) of the Internal Revenue Code of 1986 is amended by inserting
after paragraph (20) the following new item:
`(21) 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 striking the last item and inserting the following
new items:
`Sec. 224. Premiums on qualified long-term care insurance contracts.
`Sec. 225. Cross reference.'.
(d) Effective Dates- The amendments made by this section shall apply to
taxable years beginning after December 31, 2006.
SEC. 4. CREDIT FOR TAXPAYERS WITH LONG-TERM CARE NEEDS.
(a) In General- Subpart A of part IV of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to nonrefundable personal credits)
is amended by inserting after section 25D the following new section:
`SEC. 25E. 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
credit amount multiplied by the number of applicable individuals with
respect to whom the taxpayer is an eligible caregiver for the taxable
year.
`(2) APPLICABLE CREDIT AMOUNT- For purposes of paragraph (1), the applicable
credit amount shall be determined in accordance with the following table:
`For taxable years beginning
The applicable
in calendar year:
credit amount is:
2007
--$1,000
2008
--$1,500
2009
--$2,000
2010
--$2,500
2011 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--
`(A) $150,000 in the case of a joint return, and
`(B) $75,000 in any other case.
`(3) INDEXING- In the case of any taxable year beginning in a calendar
year after 2007, each dollar 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 `August of 2006' for `August of 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 6 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 preform, without reminding or cuing assistance,
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 2 but not 6 years of age and 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.
`(iii) The individual is under 2 years of age and 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.
`(A) IN GENERAL- A taxpayer shall be treated as an eligible caregiver
for any taxable year with respect to the following individuals:
`(ii) The taxpayer's spouse.
`(iii) An individual with respect to whom the taxpayer is allowed
a deduction under section 151 for the taxable year.
`(iv) An individual who would be described in clause (iii) for the
taxable year if section 152(d)(1)(B) were applied by substituting
for the exemption amount an amount equal to the sum of the exemption
amount, the standard deduction under section 63(c)(2)(C), and any
additional standard deduction under section 63(c)(3) which would be
applicable to the individual if clause (iii) applied.
`(v) An individual who would be described in clause (iii) for the
taxable year if the requirements of clause (iv) are met with respect
to the individual and section 152(c)(1) were applied without regard
to subparagraph (D).
`(B) SPECIAL RULES WHERE MORE THAN 1 ELIGIBLE CAREGIVER-
`(i) IN GENERAL- If more than 1 individual is an eligible caregiver
with respect to the same applicable individual for taxable years ending
with or within the same calendar year, a taxpayer shall be treated
as the eligible caregiver if each such individual (other than the
taxpayer) files a written declaration (in such form and manner as
the Secretary may prescribe) that such individual will not claim such
applicable individual for the credit under this section.
`(ii) NO AGREEMENT- If each individual required under clause (i) to
file a written declaration under clause (i) does not do so, the individual
with the highest modified adjusted gross income (as defined in section
32(c)(5)) shall be treated as the eligible caregiver.
`(iii) MARRIED INDIVIDUALS FILING SEPARATELY- In the case of married
individuals filing separately, the determination under this subparagraph
as to whether the husband or wife is the eligible caregiver shall
be made under the rules of clause (ii) (whether or not one of them
has filed a written declaration under clause (i)).
`(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 25E(d) (relating to credit for taxpayers with long-term
care needs) to be included on a return.'.
(2) The table of sections for subpart A of part IV of subchapter A of
chapter 1 of such Code is amended by inserting after the item relating
to section 25D the following new item:
`Sec. 25E. Credit for taxpayers with long-term care needs.'.
(c) Effective Date- The amendments made by this section shall apply to taxable
years beginning after December 31, 2006.
SEC. 5. 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) by striking paragraph (1),
(A) by striking `(2)' and inserting `(1)',
(B) by inserting `$250,000,000 for fiscal year 2007 and' before `such',
and
(C) by striking `each of the 4 succeeding fiscal years' and inserting
`fiscal years 2008, 2009, 2010, and 2011', and
(A) by striking `(3)' and inserting `(2)', and
(B) by striking `paragraphs (1) and (2)' and inserting `paragraph (1)'.
(b) Native Americans- Section 643(2) of the Older Americans Act of 1965
(42 U.S.C. 3057n(2)) is amended by striking `$5,000,000 for fiscal year
2001' and inserting `$10,000,000 for fiscal year 2007'.
END
