THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY DePASQUALE, GROVE, DEASY, LONGIETTI, SCAVELLO, BOBACK, BOYD, BRADFORD, BRIGGS, V. BROWN, CARROLL, D. COSTA, FLECK, FREEMAN, GABLER, GILLEN, GOODMAN, GRELL, HORNAMAN, HUTCHINSON, JOSEPHS, W. KELLER, KILLION, KOTIK, KULA, MILLER, MYERS, M. O'BRIEN, O'NEILL, PASHINSKI, PETRARCA, QUINN, RAPP, READSHAW, REICHLEY, K. SMITH, TALLMAN, VULAKOVICH, WATSON, WHITE, YOUNGBLOOD, DeLUCA, CALTAGIRONE, CLYMER, GEIST, GINGRICH, HALUSKA, PICKETT, STABACK, J. TAYLOR AND FRANKEL, FEBRUARY 14, 2011

REFERRED TO COMMITTEE ON FINANCE, FEBRUARY 14, 2011  

AN ACT

Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An

act relating to tax reform and State taxation by codifying

and enumerating certain subjects of taxation and imposing

taxes thereon; providing procedures for the payment,

collection, administration and enforcement thereof; providing

for tax credits in certain cases; conferring powers and

imposing duties upon the Department of Revenue, certain

employers, fiduciaries, individuals, persons, corporations

and other entities; prescribing crimes, offenses and

penalties," providing for a personal income tax credit for

long-term care premiums paid by individuals; and imposing

duties on the Secretary of the Commonwealth and the

Legislative Reference Bureau.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 301 of the act of March 4, 1971 (P.L.6,

No.2), known as the Tax Reform Code of 1971, is amended by

adding a clause to read:

Section 301.  Definitions.--Any reference in this article to

the Internal Revenue Code of 1986 shall mean the Internal

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1 et seq.),

as amended to January 1, 1997, unless the reference contains the

phrase "as amended" and refers to no other date, in which case

the reference shall be to the Internal Revenue Code of 1986 as

it exists as of the time of application of this article. The

following words, terms and phrases when used in this article

shall have the meaning ascribed to them in this section except

where the context clearly indicates a different meaning:

* * *

(l.3)  "Long-term care policy" means a policy for long-term

care insurance as those terms are defined in section 1103 of the

act of May 17, 1921 (P.L.682, No.284), known as "The Insurance

Company Law of 1921."

* * *

Section 2.  The act is amended by adding a section to read:

Section 314.1.  Long-Term Care Policy Premiums.--(a)  A

resident taxpayer shall be allowed a credit against the tax

imposed by this article in an amount equal to the lesser of

fifty per cent of any premiums paid during the taxable year by

the taxpayer for a long-term care policy for the taxpayer, the

taxpayer's spouse, or both, or one thousand dollars ($1,000).

(b)  The credit provided under this section shall not exceed

the amount of the tax otherwise due under this article.

(c)  If the taxpayer cannot use the entire amount of the tax

credit for the taxable year in which the taxpayer is eligible

for the credit, the excess may be carried over to succeeding

taxable years and used as a credit against the qualified tax

liability of the taxpayer for those taxable years. Each time the

tax credit is carried over to a succeeding taxable year, it

shall be reduced by the amount that was used as a credit during

the immediately preceding taxable year. The tax credit provided

by this article may be carried over and applied to succeeding

taxable years for no more than three taxable years following the

first taxable year for which the taxpayer was entitled to claim

the credit.

(d)  A tax credit approved by the department in a taxable

year shall first be applied against the taxpayer's qualified

liability for the current taxable year as of the date on which

the credit was approved before the tax credit can be applied

against any tax liability under subsection (c).

(e)  A taxpayer is not entitled to carry back, obtain a

refund of, sell or assign an unused tax credit.

Section 3.  The addition of sections 301(l.3) and 314.1 of

the act shall apply to taxable years beginning after December

31, 2010.

Section 4.  If a constitutional amendment authorizing a

personal income tax credit for long-term care premiums is

ratified, the Secretary of the Commonwealth shall, immediately

after tabulating and computing the returns of the ratification

election, certify the result to the Legislative Reference Bureau

for publication as a notice in the Pennsylvania Bulletin.

Section 5.  This act shall take effect as follows:

(1)  The addition of section 314.1 of the act shall take

effect upon publication of the notice under section 4.

(2)  The remainder of this act shall take effect

immediately.