Health Care Relief Act of 2007 - Amends the Internal Revenue Code to allow: (1) a refundable tax credit up to $1,000 for the health insurance coverage costs of a previously uninsured taxpayer, the taxpayer's spouse, and dependents; and (2) certain small business employers a business tax credit for amounts paid under a new health plan for employee health insurance coverage.
[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2737 Introduced in House (IH)]
110th CONGRESS
1st Session
H. R. 2737
To amend the Internal Revenue Code of 1986 to allow previously
uninsured individuals a refundable credit for health insurance costs
and to provide tax incentives to encourage small business health plans.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 15, 2007
Mr. Boswell (for himself and Mr. Bishop of Georgia) introduced the
following bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to allow previously
uninsured individuals a refundable credit for health insurance costs
and to provide tax incentives to encourage small business health plans.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Health Care Relief Act of 2007''.
SEC. 2. REFUNDABLE CREDIT FOR HEALTH INSURANCE COSTS OF PREVIOUSLY
UNINSURED INDIVIDUALS.
(a) Allowance of Credit.--
(1) In general.--Subpart C of part IV of subchapter A of
chapter 1 of the Internal Revenue Code of 1986 (relating to
refundable personal credits) is amended by redesignating
section 36 as section 37 and by inserting after section 35 the
following new section:
``SEC. 36. HEALTH INSURANCE COSTS OF PREVIOUSLY UNINSURED INDIVIDUALS.
``(a) Allowance of Credit.--In the case of a previously uninsured
individual, there shall be allowed as a credit against the tax imposed
by this subtitle for the taxable year an amount equal to the amount
paid by the taxpayer during such taxable year for health insurance
coverage for the taxpayer and the taxpayer's spouse and dependents.
``(b) Limitation.--The amount allowed as a credit under subsection
(a) for the taxable year shall not exceed $1,000 ($2,000 in the case of
a joint return filed by 2 previously uninsured individuals).
``(c) Definitions.--For purposes of this section--
``(1) Previously uninsured individual.--The term
`previously uninsured individual' means any individual who had
no health insurance coverage at any time during the 6-month
period before the earliest date that such individual has health
insurance coverage by reason of the payments taken into account
under subsection (a).
``(2) Health insurance coverage.--The term `health
insurance coverage' has the meaning given to such term by
section 9832(b)(1).
``(d) Special Rules.--
``(1) Coordination with other benefits.--The amount which
would (but for this paragraph) be taken into account by the
taxpayer under sections 35, 162(l), 213, 220, or 223 for the
taxable year shall be reduced by the credit allowed by this
section to the taxpayer for such year.
``(2) Denial of credit to dependents.--No credit shall be
allowed under this section to any individual with respect to
whom a deduction under section 151 is allowable to another
taxpayer for a taxable year beginning in the calendar year in
which such individual's taxable year begins.''.
(b) Conforming Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``, 36,'' after ``35''.
(2) The table of sections for subpart C of part IV of
subchapter A of chapter 1 of the Internal Revenue Code of 1986
is amended by striking the last item and inserting the
following:
``Sec. 36. Health insurance costs of previously uninsured individuals.
``Sec. 37. Overpayments of tax.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2007.
SEC. 3. CREDIT FOR HEALTH INSURANCE EXPENSES OF SMALL BUSINESSES.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to business-related
credits) is amended by adding at the end the following:
``SEC. 45O. SMALL BUSINESS HEALTH INSURANCE EXPENSES.
``(a) General Rule.--For purposes of section 38, in the case of a
small employer, the health insurance credit determined under this
section for the taxable year is an amount equal to 35 percent of the
expenses paid by the taxpayer during the taxable year for health
insurance coverage for such year provided under a new health plan for
employees of such employer.
``(b) Limitations.--
``(1) Per employee dollar limitation.--The amount of
expenses taken into account under subsection (a) with respect
to any employee for any taxable year shall not exceed--
``(A) $800 in the case of self-only coverage, and
``(B) $2,000 in the case of family coverage.
In the case of an employee who is covered by a new health plan
of the employer for only a portion of such taxable year, the
limitation under the preceding sentence shall be an amount
which bears the same ratio to such limitation (determined
without regard to this sentence) as such portion bears to the
entire taxable year.
``(2) Period of coverage.--Expenses may be taken into
account under subsection (a) only with respect to coverage for
the 4-year period beginning on the date the employer
establishes a new health plan.
``(3) Employer must bear 65 percent of cost.--Expenses may
be taken into account under subsection (a) only if at least 65
percent of the cost of the coverage (without regard to this
section) is borne by the employer.
``(c) Definitions.--For purposes of this section--
``(1) Health insurance coverage.--The term `health
insurance coverage' has the meaning given such term by section
9832(b)(1).
``(2) New health plan.--
``(A) In general.--The term `new health plan' means
any arrangement of the employer which provides health
insurance coverage to employees if--
``(i) such employer (and any predecessor
employer) did not establish or maintain such
arrangement (or any similar arrangement) at any
time during the 2 taxable years ending prior to
the taxable year in which the credit under this
section is first allowed, and
``(ii) such arrangement provides health
insurance coverage to at least 70 percent of
the qualified employees of such employer.
``(B) Qualified employee.--The term `qualified
employee' means any employee of an employer and shall
include a leased employee within the meaning of section
414(n).
``(3) Small employer.--The term `small employer' has the
meaning given to such term by section 4980D(d)(2); except
that--
``(A) only qualified employees shall be taken into
account, and
``(B) such section shall be applied by substituting
`100 employees' for `50 employees'.
``(d) Special Rules.--
``(1) Certain rules made applicable.--For purposes of this
section, rules similar to the rules of section 52 shall apply.
``(2) Amounts paid under salary reduction arrangements.--No
amount paid or incurred pursuant to a salary reduction
arrangement shall be taken into account under subsection (a).
``(3) Inflation adjustment.--In the case of any taxable
year beginning in a calendar year after 2008, each dollar
amount contained in subsection (b) shall be increased by an
amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins, determined by substituting
`calendar year 2006' for `calendar year 1992' in
subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be
rounded to the nearest multiple of $50.
``(e) Termination.--This section shall not apply to expenses paid
or incurred by an employer with respect to any arrangement established
on or after January 1, 2014.''.
(b) Credit To Be Part of General Business Credit.--Section 38(b) of
such Code (relating to current year business credit) is amended by
striking ``plus'' at the end of paragraph (30), by striking the period
at the end of paragraph (31) and inserting ``, plus'', and by adding at
the end the following:
``(32) in the case of a small employer (as defined in
section 45O(c)(3)), the health insurance credit determined
under section 45O(a).''.
(c) Denial of Double Benefit.--Section 280C of such Code is amended
by adding at the end the following new subsection:
``(e) Credit for Small Business Health Insurance Expenses.--
``(1) In general.--No deduction shall be allowed for that
portion of the expenses (otherwise allowable as a deduction)
taken into account in determining the credit under section 45O
for the taxable year which is equal to the amount of the credit
determined for such taxable year under section 45O(a).
``(2) Controlled groups.--Persons treated as a single
employer under subsection (a) or (b) of section 52 shall be
treated as 1 person for purposes of this section.''.
(d) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by adding
at the end the following:
``Sec. 45O. Small business health insurance expenses.''.
(e) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred in taxable years beginning after
December 31, 2007, for arrangements established after the date of the
enactment of this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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