individual health insurance;
tax incentive
HB 2133 allows all amounts for individual health insurance premium costs to be subtracted from Arizona gross income for individual income tax purposes.
Since 1995, the Legislature has allowed a personal income tax deduction for all medical costs for filers who opt to use itemized deduction in lieu of the standard deduction. Medical care costs allowed are the same as what is allowed under the federal code. This includes costs for individual health insurance premiums. Federal itemized deductions, however, are limited to those expenses over 7.5% of federal adjusted gross income. In addition, under federal law, a self-employed person, a deduction is allowed for 60% of health insurance premium costs in tax years 2000 and 2001. This is scheduled to increase to 70% in 2002 and 100% in 2003 and thereafter.
This bill will allow all taxpayers, even those using the standard deduction, to subtract health insurance premiums from their Arizona adjusted gross income.
A fiscal note has been requested on this bill.