1.This Act may be cited as the
Comprehensive Long-Term Care Support
Act of 2010
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2.The Congress hereby finds:
(1)As our Nation’s
seniors live longer lives, the United States faces a major challenge in
long-term health care needs.
(2)The United States
does not have a comprehensive system to support long-term care needs.
(3)Eighty-six percent of people age 85 and
older have at least one chronic condition which can cause pain, disability, and
loss of functioning.
(4)Long-term care is expected to place a huge
burden on State Medicaid programs, which are the primary source of funding for
nursing homes.
3.Deduction for
qualified long-term care insurance premiums
(a)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 224 as section 225 and by inserting after section 223 the
following new section:
224.Premiums on
qualified long-term care insurance contracts
(a)In the case of an individual, there shall be allowed as a
deduction an amount equal to the applicable percentage of the amount of
eligible long-term care premiums (as defined in section 213(d)(10)) paid during
the taxable year for coverage for the taxpayer or any member of the family of
the taxpayer under a qualified long-term care insurance contract (as defined in
section 7702B(b)).
(b)For purposes of subsection (a), the applicable
percentage shall be determined in accordance with the following table:
The taxable years beginning in calendar
year:The applicable percentage is:
201150
201275
2013 or thereafter100.
(c)For purposes of this section, the term member of the
family means, with respect to any individual—
(1)the spouse of the
individual,
(2)an ancestor or
lineal descendant of the individual or the individual’s spouse,
(3)a brother or
sister of the individual or any individual described in paragraph (1) or (2),
and
(4)the spouse of any
individual described in paragraph (2) or (3).
(d)Coordination
with other deductionsAny amount paid by a taxpayer for any
qualified long-term care insurance contract to which subsection (a) applies
shall not be taken into account in computing the amount allowable to the
taxpayer as a deduction under section 162(l) or
213(a).
.
(b)Long-Term care
insurance permitted To be offered under cafeteria plans and flexible spending
arrangements
(1)
(A)Section 125(f) of
the Internal Revenue Code of 1986 (defining qualified benefits), as in effect
for taxable years beginning before January 1, 2014, is amended by inserting
before the period at the end ; except that such term shall include the
payment of premiums for any qualified long-term care insurance contract (as
defined in section 7702B) to the extent the amount of such payment does not
exceed the eligible long-term care premiums (as defined in section 213(d)(10))
for such contract
.
(B)Section 125(f)(2)
of such Code, as in effect for taxable years beginning after December 31, 2013,
is amended by inserting before the period at the end ; except that such
term shall include the payment of premiums for any qualified long-term care
insurance contract (as defined in section 7702B) to the extent the amount of
such payment does not exceed the eligible long-term care premiums (as defined
in section 213(d)(10)) for such contract
.
(2)Flexible
spending arrangementsSection 106 of such Code (relating to
contributions by an employer to accident and health plans) is amended by
striking subsection (c).
(c)
(1)Section 62(a) of
the Internal Revenue Code of 1986 is amended by inserting after paragraph (21)
the following new item:
(22)Premiums on
qualified long-term care insurance contractsThe deduction
allowed by section
224.
.
(2)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. 224. Premiums on qualified long-term
care insurance contracts.
Sec. 225. Cross
reference.
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(d)The amendments made by
this section shall apply to taxable years beginning after December 31,
2010.
4.Credit for
taxpayers with long-term care needs
(a)Subpart A of part IV of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to nonrefundable personal credits) is
amended by inserting after section 25D the following new section:
25E.Credit for
taxpayers with long-term care needs
(a)
(1)There shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount equal to the applicable
credit amount multiplied by the number of applicable individuals with respect
to whom the taxpayer is an eligible caregiver for the taxable year.
(2)For purposes of paragraph (1), the applicable
credit amount shall be determined in accordance with the following
table:
For taxable years beginning in calendar
year:The applicable credit amount
is:
2011$1,000
2012$1,500
2013$2,000
2014$2,500
2015 or thereafter$3,000.
(b)Limitation based
on adjusted gross income
(1)The amount of the credit allowable under subsection (a)
shall be reduced (but not below zero) by $100 for each $1,000 (or fraction
thereof) by which the taxpayer’s modified adjusted gross income exceeds the
threshold amount. For purposes of the preceding sentence, the term
modified adjusted gross income means adjusted gross income
increased by any amount excluded from gross income under section 911, 931, or
933.
(2)For purposes of paragraph (1), the term threshold
amount means—
(A)$150,000 in the
case of a joint return, and
(B)$75,000 in any
other case.
(3)In
the case of any taxable year beginning in a calendar year after 2011, each
dollar amount contained in paragraph (2) shall be increased by an amount equal
to the product of—
(A)such dollar
amount, and
(B)the medical care
cost adjustment determined under section 213(d)(10)(B)(ii) for the calendar
year in which the taxable year begins, determined by substituting August
of 2010
for August of 1996
in subclause (II)
thereof.
If any
increase determined under the preceding sentence is not a multiple of $50, such
increase shall be rounded to the next lowest multiple of $50.(c)For
purposes of this section—
(1)
(A)The term applicable individual means, with
respect to any taxable year, any individual who has been certified, before the
due date for filing the return of tax for the taxable year (without
extensions), by a physician (as defined in section 1861(r)(1) of the Social
Security Act) as being an individual with long-term care needs described in
subparagraph (B) for a period—
(i)which is at least
180 consecutive days, and
(ii)a
portion of which occurs within the taxable year.
Such
term shall not include any individual otherwise meeting the requirements of the
preceding sentence unless within the 39½ month period
ending on such due date (or such other period as the Secretary prescribes) a
physician (as so defined) has certified that such individual meets such
requirements.(B)Individuals with
long-term care needsAn individual is described in this
subparagraph if the individual meets any of the following requirements:
(i)The individual is
at least 6 years of age and—
(I)is unable to
perform (without substantial assistance from another individual) at least 3
activities of daily living (as defined in section 7702B(c)(2)(B)) due to a loss
of functional capacity, or
(II)requires
substantial supervision to protect such individual from threats to health and
safety due to severe cognitive impairment and is unable to preform, without
reminding or cuing assistance, at least 1 activity of daily living (as so
defined) or to the extent provided in regulations prescribed by the Secretary
(in consultation with the Secretary of Health and Human Services), is unable to
engage in age appropriate activities.
(ii)The individual is
at least 2 but not 6 years of age and is unable due to a loss of functional
capacity to perform (without substantial assistance from another individual) at
least 2 of the following activities: eating, transferring, or mobility.
(iii)The individual
is under 2 years of age and requires specific durable medical equipment by
reason of a severe health condition or requires a skilled practitioner trained
to address the individual’s condition to be available if the individual’s
parents or guardians are absent.
(2)
(A)A taxpayer shall be treated as an eligible caregiver for
any taxable year with respect to the following individuals:
(i)The
taxpayer.
(ii)The taxpayer’s
spouse.
(iii)An individual
with respect to whom the taxpayer is allowed a deduction under section 151 for
the taxable year.
(iv)An individual who would be described in
clause (iii) for the taxable year if section 152(d)(1)(B) were applied by
substituting for the exemption amount an amount equal to the sum of the
exemption amount, the standard deduction under section 63(c)(2)(C), and any
additional standard deduction under section 63(c)(3) which would be applicable
to the individual if clause (iii) applied.
(v)An individual who would be described in
clause (iii) for the taxable year if the requirements of clause (iv) are met
with respect to the individual and section 152(c)(1) were applied without
regard to subparagraph (D).
(B)Special rules
where more than 1 eligible caregiver
(i)If more than 1 individual is an eligible caregiver with
respect to the same applicable individual for taxable years ending with or
within the same calendar year, a taxpayer shall be treated as the eligible
caregiver if each such individual (other than the taxpayer) files a written
declaration (in such form and manner as the Secretary may prescribe) that such
individual will not claim such applicable individual for the credit under this
section.
(ii)If each individual required under clause (i) to file a
written declaration under clause (i) does not do so, the individual with the
highest modified adjusted gross income (as defined in section 32(c)(5)) shall
be treated as the eligible caregiver.
(iii)Married
individuals filing separatelyIn the case of married individuals
filing separately, the determination under this subparagraph as to whether the
husband or wife is the eligible caregiver shall be made under the rules of
clause (ii) (whether or not one of them has filed a written declaration under
clause (i)).
(d)Identification
requirementNo credit shall be allowed under this section to a
taxpayer with respect to any applicable individual unless the taxpayer includes
the name and taxpayer identification number of such individual, and the
identification number of the physician certifying such individual, on the
return of tax for the taxable year.
(e)Taxable year
must be full taxable yearExcept in the case of a taxable year
closed by reason of the death of the taxpayer, no credit shall be allowable
under this section in the case of a taxable year covering a period of less than
12
months.
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(b)
(1)Section 6213(g)(2)
of the Internal Revenue Code of 1986 is amended by striking and
at the end of subparagraph (O), by striking the period at the end of
subparagraph (P) and inserting , and
, and by inserting after
subparagraph (P) the following new subparagraph:
(Q)an omission of a
correct TIN or physician identification required under section 25E(d) (relating
to credit for taxpayers with long-term care needs) to be included on a
return.
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(2)The table of
sections for subpart A of part IV of subchapter A of chapter 1 of such Code is
amended by inserting after the item relating to section 25D the following new
item:
Sec. 25E. Credit for taxpayers with
long-term care
needs.
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(c)The amendments made by this section shall apply to taxable
years beginning after December 31, 2010.