Income Tax - Credit for Long-Term Care Premiums (Long-Term Care Relief Act of 2022)
If enacted, SB58 will affect Maryland's tax regulations, specifically in relation to deductions for long-term care insurance premiums. The bill allows taxpayers with an adjusted gross income below $250,000 to claim a tax credit equivalent to 100% of their long-term care premiums for insurance covering themselves or certain family members. The credit is capped at the lesser of 20% of the eligible premiums paid or $2,000, which encourages and potentially increases the number of residents obtaining long-term care insurance.
Senate Bill 58, titled the Long-Term Care Relief Act of 2022, seeks to amend the eligibility criteria and the maximum credit amount applicable against the state income tax for individuals paying premiums on long-term care insurance. The bill's core objective is to expand access to long-term care insurance by incentivizing Maryland residents through a tax credit, thereby promoting more sustainable financial planning for future healthcare needs among the population.
There are points of contention surrounding the bill, particularly related to the income eligibility threshold and the maximum credit amount. Critics argue that while a 100% tax credit sounds beneficial, the cap may not significantly alleviate the financial burden of long-term care costs for many families, especially as healthcare expenses continue to rise. Additionally, concerns may arise regarding how the implementation of this bill could impact state revenues and whether enough provisions are included to ensure those with higher needs can access adequate care.