House File 2055 - Introduced HOUSE FILE BY FREVERT Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to an income tax deduction for costs of long= 2 term care insurance contracts and including an effective and 3 retroactive applicability date provision. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 5584HH 81 6 mg/je/5 PAG LIN 1 1 Section 1. Section 422.7, subsection 29, Code Supplement 1 2 2005, is amended to read as follows: 1 3 29. Subtract, to the extent not otherwise deducted in 1 4 computing adjusted gross income, the amounts paid by the 1 5 taxpayer for the purchase of health benefits coverage or 1 6 insurance, including a qualified long=term care insurance 1 7 contract, for the taxpayer or taxpayer's spouse or dependent. 1 8 For purposes of this subsection, "qualified long=term care 1 9 insurance contract" means the same as defined in section 7702B 1 10 of the Internal Revenue Code. 1 11 Sec. 2. EFFECTIVE AND RETROACTIVE APPLICABILITY DATE. 1 12 This Act, being deemed of immediate importance, takes effect 1 13 upon enactment and applies retroactively to January 1, 2006, 1 14 for tax years beginning on or after that date. 1 15 EXPLANATION 1 16 This bill allows a taxpayer to deduct, in determining net 1 17 income, amounts paid for a qualified long=term care insurance 1 18 contract for the taxpayer or the taxpayer's spouse or 1 19 dependent. This deduction would otherwise be an itemized 1 20 deduction. The insurance contract, per the Internal Revenue 1 21 Code, is a renewable insurance policy that has no cash 1 22 surrender value and that provides coverage for necessary 1 23 diagnostic, preventive, therapeutic, curing, treatment, 1 24 mitigating, and rehabilitative services to chronically ill 1 25 individuals prescribed by a licensed health care practitioner. 1 26 LSB 5584HH 81 1 27 mg:nh/je/5