Bill would make long-term care premiums tax-deductible

Federal employees and other Americans should be able to deduct the cost of long-term care insurance premiums from their tax bills, lawmakers and retirees said at a Capitol Hill press conference Thursday.

The lawmakers and retirees, including members of the National Association of Retired Federal Employees, urged Congress to pass bills that would make long-term care premiums deductible (H.R. 831 and S. 627). The push for the bills comes as a new federal long-term care insurance program for federal employees, military personnel, federal and military retirees and family members gets under way.

An early enrollment period for the program runs until May 15. An official open season will run from July 1 to Dec. 31. The insurance covers nursing home stays and other types of day-to-day care for people with chronic illnesses or disabilities.

Under current tax law, people can deduct the cost of the long-term care premiums at tax time if their medical and dental expenses for the year, including the premiums, add up to more than 7.5 percent of adjusted gross income. The proposed bills would make long-term care premiums a stand-alone deduction with no total spending requirements.

The Bush administration proposed such a change in its fiscal 2003 budget.

"The above-the-line tax deduction would make the new federal plan and other long-term care policies more affordable," National Association of Retired Federal Employees President Frank Atwater said.

Rep. Karen Thurman, D-Fla., said the bill would encourage Americans other than federal employees to get long-term care insurance as well.