[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3475 Introduced in House (IH)]







105th CONGRESS
  2d Session
                                H. R. 3475

To amend the Internal Revenue Code of 1986 to allow a deduction for the 
   health insurance costs of all individuals who are not eligible to 
            participate in employer-subsidized health plans.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 17, 1998

 Mrs. Johnson of Connecticut introduced the following bill; which was 
              referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to allow a deduction for the 
   health insurance costs of all individuals who are not eligible to 
            participate in employer-subsidized health plans.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Tax Fairness for Health Consumers 
Act of 1998''.

SEC. 2. DEDUCTION FOR HEALTH INSURANCE COSTS FOR INDIVIDUALS NOT 
              ELIGIBLE TO PARTICIPATE IN EMPLOYER-SUBSIDIZED HEALTH 
              PLANS.

    (a) In General.--Part VII of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to additional itemized 
deductions) is amended by redesignating section 222 as section 223 and 
by inserting after section 221 the following new section:

``SEC. 222. HEALTH INSURANCE COSTS.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a deduction an amount equal to the applicable percentage of 
the amount paid during the taxable year for insurance which constitutes 
medical care for the taxpayer, his spouse, and dependents.
    ``(b) Applicable Percentage.--For purposes of subsection (a), the 
applicable percentage shall be determined in accordance with the 
following table:

``For taxable years beginning in    The applicable percentage is--
        calendar year--
    1998 and 1999.................................                  45 
    2000 and 2001.................................                  50 
    2002..........................................                  60 
    2003 through 2005.............................                  80 
    2006..........................................                  90 
    2007 and thereafter...........................                 100.

    ``(c) Limitations.--
            ``(1) Other coverage.--Subsection (a) shall not apply to 
        any taxpayer for any calendar month for which the taxpayer is 
        eligible to participate in any subsidized health plan 
        maintained by any employer of the taxpayer or of the spouse of 
        the taxpayer. The preceding sentence shall be applied 
        separately with respect to--
                    ``(A) plans which include coverage for qualified 
                long-term care services (as defined in section 
                7702B(c)) or are qualified long-term care insurance 
                contracts (as defined in section 7702B(b)), and
                    ``(B) plans which do not include such coverage and 
                are not such contracts.
            ``(2) Long-term care premiums.--In the case of a qualified 
        long-term care insurance contract (as defined in section 
        7702B(b)), only eligible long-term care premiums (as defined in 
        section 213(d)(10)) shall be taken into account under 
        subsection (a).
            ``(3) Medicare premiums.--Subsection (a) shall not apply to 
        amounts paid as premiums under part B of title XVIII of the 
        Social Security Act.
    ``(d) Special Rules.--
            ``(1) Coordination with medical deduction, etc.--Any amount 
        paid by a taxpayer for insurance to which subsection (a) 
        applies shall not be taken into account in computing the amount 
        allowable to the taxpayer as a deduction under section 213(a).
            ``(2) Deduction not allowed for self-employment tax 
        purposes.--The deduction allowable by reason of this section 
        shall not be taken into account in determining an individual's 
        net earnings from self-employment (within the meaning of 
        section 1402(a)) for purposes of chapter 2.''
    (b) Conforming Amendments.--
            (1) Subsection (l) of section 162 of such Code is hereby 
        repealed.
            (2) Subsection (a) of section 62 of such Code is amended by 
        inserting after paragraph (17) the following new paragraph:
            ``(18) Health insurance costs of certain individuals.--The 
        deduction allowed by section 222.''
            (3) The table of sections for part VII of subchapter B of 
        chapter 1 of such Code is amended by striking the last item and 
        inserting the following new items:

                              ``Sec. 222. Health insurance costs.
                              ``Sec. 223. Cross reference.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1997.
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