Tax Credit; Elderly
Provides a tax credit for the expenses related to the care of an elderly relative.
HOUSE OF REPRESENTATIVES
TWENTY-SECOND LEGISLATURE, 2003
STATE OF HAWAII
A BILL FOR AN ACT
relating to health care.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§235- Care of e1der1y tax credit. (a) Each resident taxpayer who files an individual income tax return for a taxable year, and who is not claimed or is not otherwise eligible to be claimed as a dependent by another taxpayer for federal or Hawaii state individual income tax purposes, may claim a care of elderly tax credit against the taxpayer's individual income tax liability; provided that a husband and wife filing separate returns for a taxable year for which a joint return could have been filed by them shall claim only the tax credit to which they would have been entitled had a joint return been filed; and provided that a resident individual who has no income or no income taxable under this chanter and who is not claimed or is not otherwise eligible to be claimed as a dependent by a taxpayer
for federal or Hawaii state individual income tax purposes may also claim the tax credit set forth in this section.
(b) Each individual taxpayer may claim a one-time credit in the amount of $2,000 for the care of an elderly or disabled relative as provided in this section. In order to claim a tax credit under this section, the elderly relative must:
(1) Be certified eligible for an intermediate care or skilled nursing facility by the department of human services for the whole of the taxable year for which the credit is claimed;
(2) Have no income taxable under this chapter;
(3) Be totally disabled or age sixty-five years or more; and
(4) Have been cared for and maintained in the taxpayer's residence for a period of not less than eleven months.
(c) In order to claim a tax credit under this section, no taxpayer shall:
(1) Have placed an elderly relative for whom the tax credit is claimed in any intermediate care or skilled nursing facility for a period of more than twenty-nine days during the taxable year;
(2) Operate any type of nonprofit or for-profit care service for elderly individuals; or
(3) Claim a tax credit under section 235-55.6.
The taxpayer shall be the primary caregiver for the elderly or disabled family member.
(e) As used in this section:
"Elderly relative" means any adult person related to the taxpayer or the taxpayer's spouse as a grandparent, parent, aunt, uncle, sibling, or first cousin.
"Modified adjusted gross income" includes adjusted gross income plus the following income exempt from income taxation or partially or totally deducted from gross or adjusted gross income: unemployment compensation not otherwise included in income, workers' compensation benefits, interest on tax-free securities, public assistance payments, individual housing account deductions, individual retirement account deductions, deductions for Keogh retirement plans, social security benefits, pensions, annuities, proceeds from life insurance, capital gain exclusions, and dividends excluded from income.
(f) The tax credit claimed by a resident taxpayer pursuant to this section shall be deductible from the resident taxpayer's individual income tax liability, if any, for the tax year in which properly claimed. If the tax credit claimed by a resident taxpayer exceeds the amount of income tax payment due from the resident taxpayer, the excess of credit over payments due shall be refunded to the resident taxpayer; provided that a tax credit properly claimed by a resident individual who has no income tax liability shall be paid to the resident individual; and provided further that no refunds or payment on account of the tax credit allowed by this section shall be made for amounts less than $1.
(g) All claims for a tax credit under this section, including any amended claims, shall be filed on or before the end of the twelfth month following the close of the taxab1e year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver or the right to claim the credit.
(h) The director of taxation shall prepare the appropriate forms to be used under this section, may require proof of the claim for tax credit, and may adopt appropriate rules under chapter 91."
SECTION 2. New statutory material is underscored.
SECTION 3. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2003.