Virginia bill would ax LTCI tax credit
By National Underwriter
By Allison Bell
A Virginia state lawmaker has proposed a state tax and transportation funding bill that would repeal the state's long-term care insurance (LTCI) tax credit.
Delegate David Albo, R-Fairfax Station, Va., has introduced House Bill 2253.
The bill would make many changes in the Virginia tax code, such as imposing a 5 percent state tax on motor fuels; increasing the state registration fee on electric vehicles to $102, from $50; and repealing the exemption for nonprofit entities.
The bill also would exempt food from taxation and cut all state individual income tax rates by 0.2 percent points.
In a section that repeals several existing tax provisions, Albo calls for repealing a land preservation tax credit, a coal field employment tax credit, and the LTCI tax credit.
Virginia now lets individuals claim a credit equal to 15 percent of the total amount of LTCI premiums paid over a 12-month period.
Virginia also has a separate LTCI premium deduction provision, officials note in a description of the LTCI tax credit.
An individual cannot use the same premiums to get both the tax credit and the tax deduction, but, in some cases, if an LTCI policy year is different from an individual's tax year, the individual might be able to use the LTCI deduction for part of a tax year and the LTCI credit for the rest of the year, officials say.
Albo is chairman of the Virginia House Justice Committee and a member of the House General Laws and Privileges and Elections committees. The committee that has jurisdiction over H.B. 2253 is the House Finance Committee.
If the bill passes as written, most provisions, including the LTCI tax repeal provision, would take effect Jan. 1, 2016.
Originally published on LifeHealthPro.com