HF2176 expands Minnesota’s individual income tax credit for long-term care insurance premiums. Under current law, taxpayers may claim a credit equal to 25 percent of qualifying premiums paid, subject to a per-beneficiary cap and annual maximum credit limits. This bill increases those limits from $100 to $250 per qualified beneficiary, from $200 to $500 for married couples filing jointly, and from $100 to $250 for all other filers.
The bill does not change the basic structure of the credit or who may claim it; it still applies only to premiums for a qualified long-term care insurance policy and only to the extent the premiums were not already deducted in computing taxable income. It also retains the existing rule for nonresidents and part-year residents, who must allocate the credit based on Minnesota-source income. The new limits would apply to taxable years beginning after December 31, 2024.
Impact
HF2176 would amend Minnesota Statutes section 290.0672, subdivision 2, by increasing the maximum long-term care insurance tax credit available to eligible taxpayers. The practical effect is to reduce state income tax liability for individuals and married couples who pay qualifying long-term care insurance premiums, with the largest benefit going to taxpayers who purchase such coverage and can use the credit. The bill would take effect for taxable years beginning after December 31, 2024, and would not otherwise alter the state’s tax base or the underlying definition of qualifying coverage.
Sentiment
The available context suggests the bill is straightforward and likely intended as a supportive tax policy for long-term care planning. There are no recorded committee transcripts or votes indicating opposition or debate, and the bill was referred to the House Taxes Committee after introduction. The caption and text indicate a clear policy goal of expanding relief for taxpayers who purchase long-term care insurance, which generally suggests favorable treatment among proponents of elder-care and insurance affordability measures.
Contention
No specific points of contention are documented in the provided materials. Potential areas of debate, if raised, would likely concern the cost to state revenues, whether the credit should be targeted to a broader or narrower group of taxpayers, and whether increasing the credit meaningfully improves long-term care insurance uptake. However, the record provided does not show any expressed opposition, amendments, or divided votes.