Maryland HB 1344: Income Tax - Credit for Long-Term Care Premiums

Bill Text

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb1344*

HOUSE BILL 1344
Q3 4lr2368
HB 1185/23 – W&M
By: Delegates Howard, Alston, Arentz, Bagnall, Buckel, Conaway, Griffith,
Hartman, Hornberger, Jacobs, McComas, Miller, T. Morgan, Otto, Reilly,
Rose, Stonko, Taylor, and Tomlinson
Introduced and read first time: February 9, 2024
Assigned to: Ways and Means

A BILL ENTITLED

AN ACT concerning 1

Income Tax – Credit for Long–Term Care Premiums 2

FOR the purpose of altering a certain limitation on a certain credit against the State income 3
tax for certain long–term care insurance premiums paid by a taxpayer; altering the 4
amount a taxpayer may claim as a credit for certain long–term care insurance 5
purchased after a certain date; and generally relating to a certain income tax credit 6
for eligible long–term care premiums. 7

BY repealing and reenacting, with amendments, 8
Article – Tax – General 9
Section 10–718 10
Annotated Code of Maryland 11
(2022 Replacement Volume and 2023 Supplement) 12

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 13
That the Laws of Maryland read as follows: 14

Article – Tax – General 15

10–718. 16

(a) In this section, “eligible long–term care premiums” means eligible long–term 17
care premiums within the meaning of § 213(d)(10) of the Internal Revenue Code for a 18
long–term care insurance contract covering an individual who is a Maryland resident. 19

(b) [An individual] A TAXPAYER may claim a credit against the State income tax 20
in an amount equal to 100% of the eligible long–term care premiums paid by the 21
[individual] TAXPAYER during the taxable year for long–term care insurance covering the 22

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[individual] TAXPAYER or the [individual’s] TAXPAYER’S spouse, parent, stepparent, 1
child, or stepchild. 2

(c) The credit allowed under this section: 3

(1) [may not exceed $500 for] WITH RESPECT TO each insured 4
INDIVIDUAL covered by long–term care insurance for which the [individual] TAXPAYER 5
pays the premiums, MAY NOT EXCEED: 6

(I) $250 FOR A TAXABLE YEAR BEGINNING AFTER DECEMBER 7
31, 2024, BUT BEFORE JANUARY 1, 2027; AND 8

(II) $500 FOR A TAXABLE YEAR BEGINNING AFTER DECEMBER 9
31, 2026; 10

(2) may not be claimed by more than one taxpayer with respect to the same 11
insured individual IN THE SAME TAXABLE YEAR; and 12

(3) may not be claimed with respect to an insured individual if: 13

(i) the insured individual was covered by long–term care insurance 14
at any time before [July 1, 2000] JANUARY 1, 2025; [or] AND 15

(ii) the credit has been claimed with respect to that insured 16
individual by any taxpayer for any [prior] taxable year BEGINNING BEFORE JANUARY 1, 17
2025. 18

(d) (1) The total amount of the credit allowed under this section for any taxable 19
year may not exceed the State income tax for that taxable year, calculated before 20
application of the credits under this section and §§ 10–701 and 10–701.1 of this subtitle, 21
but after application of the other credits allowable under this subtitle. 22

(2) The unused amount of the credit for any taxable year may not be carried 23
over to any other taxable year. 24

(e) The credit allowed under this section does not affect the treatment under this 25
title of any deduction or exclusion allowed for federal income tax purposes for the eligible 26
long–term care premiums paid by the individual. 27

(f) On or before December 1, 2005, and each December 1 thereafter, the 28
Comptroller shall report to the Governor and, subject to § 2–1257 of the State Government 29
Article, to the General Assembly, regarding the credit allowed under this section, including: 30

(1) the number of individuals who have claimed the credit, the amount 31
allowed as credits, and the additional number of individuals covered by long–term care 32
insurance as a result of the credit; and 33

HOUSE BILL 1344 3

(2) the savings under the State’s Medical Assistance Program as a result 1
of additional individuals being covered by long–term care insurance as a result of the credit. 2

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 3
1, 2024, and shall be applicable to all taxable years beginning after December 31, 2024. 4