House Approves Deduction For Long-Term Care Insurance
It is estimated that the tax cut will provide $5.3 billion in savings to taxpayers over the next 10 years. Only taxpayers in lower tax brackets will qualify for the deduction. Individual taxpayers with adjusted gross income between $20,000 and $40,000, and married taxpayers who file jointly and whose adjusted gross income is between $40,000 and $80,000 will qualify for the deduction. The deduction, if made into law, will be phased in over 10 years.
It is the hope of the members of Congress that passage of this bill will encourage taxpayers to purchase private insurance and rely less on the federal Medicare and Medicaid programs. "If we don't put incentives in for individuals, our public funds will be depleted," said Representative J.D. Hayworth (R-AZ), sponsor of the bill.
Other provisions of the bill include a tax deduction for the care of a dependent in a taxpayer's home and expanded access to Archer Medical Savings Accounts (MSAs).
Dissenters of the bill, such as Representative Fortney Stark (D-CA) claim the bill is not designed to help taxpayers as much as it is designed to "bail out the insurance industry."