SENATE, No. 496

 

STATE OF NEW JERSEY

 

INTRODUCED JANUARY 22, 1996

 

 

By Senator BENNETT

 

 

An Act providing a credit for certain costs of long-term care insurance under the corporation business tax and supplementing P.L.1945, c.162 (C.54:10A-1 et seq.).

 

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

    1. A taxpayer who offers a long-term care insurance policy to employees shall be entitled to a credit as provided herein against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to 50% of the cost of providing the policy. The amount of the credit claimed in the tax year in which the cost is incurred shall not exceed 50% of the tax liability which would be otherwise due, and shall not reduce the amount of the tax liability to less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5).

    As used in this section, "long-term care insurance policy" means a group or individual insurance policy, or portion thereof, which provides benefits for a period of not less than 12 months for each person covered under the policy, on an expense incurred, indemnity, or annuity basis, or combination thereof, for necessary diagnostic, preventive, therapeutic or custodial services in or by a duly licensed home health agency, intermediate nursing facility, or nursing care facility.

    As used in this section, "cost of providing the policy" means all costs incurred by the taxpayer which are directly related to providing a long-term care insurance policy to employees, including, but not limited to, purchase of the policy, and administrative expenses, regardless of whether the taxpayer pays any portion of the cost to purchase the policy.

 

    2. The Director of the Division of Taxation, in consultation with the Commissioner of Health, shall promulgate rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as may be necessary to effectuate the purposes of this act.


    3. This act shall take effect immediately.

 

 

STATEMENT

 

    This bill creates a corporation business tax credit for 50% of any costs incurred by an employer which are related to providing a long-term care insurance policy to employees. The credit cannot reduce the employers' tax liability below the minimum tax. Long-term care insurance is defined as any policy which provides benefits for a period of not less than 12 months on expenses incurred for diagnostic, preventive, therapeutic, or custodial services in or by a home health agency, intermediate nursing facility, or nursing care facility.

 

 

                             

 

Creates a corporation business tax credit for part of the costs of providing long-term care insurance policies to employees.