Recent Legislation: The Johnson-Thurman Bill
The Long-Term Care and Retirement Security Act ("Johnson-Thurman Bill") was recently introduced in the House of Representatives. Sponsored by Reps. Nancy Johnson, R-Conn., and Nancy Thurman, D-Fla., the legislation phases in a 100 percent tax deduction for private LTC insurance premiums.
The legislation would give people who pay 50 percent or more of the cost of a qualified long-term care policy a tax deduction. This would start at a 50 percent tax deduction in the first year and increase to 100 percent in the sixth year. For those over 60 years of age, the phase-in schedule would be accelerated, reaching 100 percent in only four years. The bill does not provide tax deductions for non-tax-qualified long-term care policies.
The bill also gives individuals with LTC needs or their caregivers a $1,000 tax credit to help cover expenses.
A final provision of the bill would launch a massive public education campaign on long-term care through the Social Security Administration, providing people with information about the limitations of LTC benefits under Medicare and Medicaid. SSA would also provide information on what to look for in LTC policies and the tax benefits. This information would be sent along with routine Social Security mailings.
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