NC Reenacts Long-Term Care Insurance Tax Credit
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The North Carolina Long-Term Care Insurance Premium Tax Credit has been reenacted effective for the 2007 tax year through 2012. A credit of 15% of the premium costs, up to a maximum of $350, is allowable for each policy. The credit is restricted those under the following AGI limits:
Married filing jointly – $100,000
Head of Household – $80,000
Single – $60,000
Married filing separately – $50,000
Also, those that take a deduction as part of health care expenses on their Federal income tax return cannot take the NC LTC tax credit.
Click “Continue Reading” for the text of the statute.
REENACT LONG-TERM CARE CREDIT
SECTION 31.5.(a) G.S. 105-151.28 is reenacted and reads as rewritten:
Ҥ 105-151.28. Credit for premiums paid on long-term care insurance.
(a) Credit. – An individual is A taxpayer whose adjusted gross income (AGI),
as calculated under the Code, is less than the amount listed in this section
is allowed, as a credit against the tax imposed by this Part, an amount
equal to fifteen percent (15%) of the premium costs the individual taxpayer
paid during the taxable year on a qualified long-term care insurance
contract that offers coverage to either the individual, taxpayer, the
individual’staxpayer’s spouse, or a dependent for whom the individual
taxpayer was allowed to deduct a personal exemption under section
151(c)(1)(A) of the Code for the taxable year. The credit allowed by this
section may not exceed three hundred fifty dollars ($350.00) for each
qualified long-term care insurance contract for which a credit is claimed.
The credit allowed under this section may not exceed the amount of tax
imposed by this Part for the taxable year reduced by the sum of all credits
allowed, except payments of tax made by or on behalf of the taxpayer. A
nonresident or part-year resident who claims the credit allowed by this
subsection shall reduce the amount of the credit by multiplying it by the
fraction calculated under G.S. 105-134.5(b) or (c), as appropriate.
Filing Status AGI
Married, filing jointly $100,000
Head of Household 80,000
Single 60,000
Married, filing separately 50,000
(b) No Double Benefit. – No credit is allowed for payments that are deducted
from, or not included in, the taxpayer’s gross income for the taxable year.
If the taxpayer claimed a deduction for health insurance costs of
self-employed individuals under section 162(l) of the Code for the taxable
year, the amount of credit otherwise allowed the taxpayer under this section
is reduced by the applicable percentage provided in section 162(l) of the
Code. If the taxpayer claimed a deduction for medical care Page 278 Session
Law 2007-323 SL2007-0323 expenses under section 213 of the Code for the
taxable year, the taxpayer is not allowed a credit under this section. A
taxpayer who claims the credit allowed by this section must provide any
information required by the Secretary to demonstrate that the amount paid
for premiums for which the credit is claimed was not excluded from the
taxpayer’s gross income for the taxable year.
(c) Definition. – For purposes of this section, the term “qualified
long-term care insurance contract” has the same meaning as defined in
section 7702B of the Code.
(d) Sunset. – This section is repealed for taxable years beginning on or
after January 1, 2013.”
SECTION 31.5.(b) G.S. 105-160.3(b)(7) is reenacted.
SECTION 31.5.(c) This section is effective for taxable years beginning on or
after January 1, 2007.
