Citations Affected: IC 6-3-2-19.
Synopsis: Deduction for long term home care. Provides that an
individual is entitled to an adjusted gross income tax deduction of
$2,750 for certain elderly family members who are chronically ill and
who reside in the individual's home for more than one-half of the
taxable year. Provides that the deduction is adjusted each year based on
changes in the consumer price index.
Effective: January 1, 2000 (retroactive).
January 10, 2000, read first time and referred to Committee on Finance.
A BILL FOR AN ACT to amend the Indiana Code concerning
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2000 (RETROACTIVE)]: Sec. 19. (a) As used in this
section, "qualified person" means an individual:
(1) who is:
(A) a father or mother of the taxpayer;
(B) a stepparent of the taxpayer;
(C) the spouse of the taxpayer; or
(D) an ancestor of an individual described in clause (A), (B), or (C);
(2) who is a chronically ill individual (as defined in section 7702B(c)(2) of the Internal Revenue Code); and
(3) who is at least sixty-five (65) years of age.
(b) Except as provided in subsections (c) and (d), an individual (or a husband and wife filing jointly) is entitled to a deduction from the individual's adjusted gross income for the taxable year in an amount equal to:
(1) two thousand seven hundred fifty dollars ($2,750); multiplied by
(2) the number of qualified persons who reside in the individual's home for more than one-half (1/2) of the taxable year.
(c) An individual is not entitled to claim a deduction for a qualified person under this section to the extent that the individual is entitled to claim an exemption or a deduction from gross income under the Internal Revenue Code for the qualified person on account of the qualified person's status as:
(1) a chronically ill individual; or
(2) an individual in need of qualified long term care services (as defined in section 7702B(c)(1) of the Internal Revenue Code).
(d) As used in this subsection, "CPI" refers to the United States Bureau of Labor Statistics Consumer Price Index for Indiana, all items, all urban consumers, or its successor index. For taxable years beginning after December 31, 2000, the department shall adjust the amount of the deduction under subsection (b)(1) for each qualified person as follows:
STEP ONE: Determine the percentage change between the CPI as last reported in the previous calendar year and the CPI as last reported in the year before the previous calendar year.
STEP TWO: Express the percentage change determined in STEP ONE as a two (2) digit decimal rounded to the nearest hundredth.
STEP THREE: Add one (1) to the decimal determined in STEP TWO.
STEP FOUR: Multiply the greater of one (1) or the sum determined in STEP THREE by the deduction amount, as adjusted under this subsection for the previous taxable year.
(e) To obtain a deduction under this chapter, an individual must claim the deduction on the taxpayer's annual state tax return or returns in the manner prescribed by the department. The taxpayer must submit to the department all information that the department determines is necessary for the calculation of the deduction provided by this section.
SECTION 2. [EFFECTIVE JANUARY 1, 2000 (RETROACTIVE)] IC 6-3-2-19 , as added by this act, applies only to taxable years beginning after December 31, 1999.
SECTION 3. An emergency is declared for this act.