Bill
H 3017
Allows Massachusetts self-employed individuals to deduct health insurance premiums for themselves, spouses, and dependents from their gross income, lowering state taxes.
Note: The bill file contains inconsistent material. The principal Massachusetts bill text and sponsor information (Rep. Bruce J. Ayers) relate to a state income tax deduction for health insurance paid by self‑employed individuals. Separately, the file also contains unrelated South Carolina draft language repealing statutes on ephedrine/pseudoephedrine sales and electronic monitoring — that text appears to be included in error and is not consistent with the Massachusetts bill caption, sponsor, or petition language. The summary below focuses on the Massachusetts bill language actually presented by Rep. Ayers.
Purpose
- To allow self‑employed individuals to deduct amounts they pay for health insurance for themselves, their spouse, and dependents from Massachusetts gross income for state income tax purposes.
Key provisions
- Amends Chapter 62 (Massachusetts income tax law) by inserting a new subsection at the end of section 2, subsection (a)(2):
- Adds paragraph (k): “Amounts paid during the taxable year by a self‑employed individual, as defined in section 401(c)(I)(B) of the Code, for insurance which constitutes medical care for the self‑employed individual, their spouse and dependents.”
- The new provision would treat qualifying health insurance payments made by self‑employed individuals as deductible from gross income on the state tax return.
Who would be affected
- Primary beneficiaries: self‑employed taxpayers in Massachusetts (definition references federal Code language for “self‑employed individual”; typically includes sole proprietors and certain partners/shareholders who meet federal criteria).
- Secondary effects: reduced Massachusetts taxable income for those taxpayers; potential decrease in state income tax revenue.
- Health insurers or providers are not directly affected by the tax change, but taxpayers’ after‑tax cost of insurance may be reduced.
Procedural status and timeline (as of provided records)
- Prefiled: 12/05/2024
- Introduced/read first time: 01/14/2025
- Referred to Committee on Judiciary (and also shown as referred to Revenue committee in some entries)
- Multiple hearings scheduled/rescheduled for 11/18/2025 (committee hearing notices show several updates)
- Status entries include duplicate lines and an unexplained “Senate concurred” notation (may reflect clerical duplication)
Potential impact and considerations
- Aligns state tax treatment with the policy goal of reducing after‑tax health insurance costs for self‑employed individuals.
- Would reduce state income tax revenues to the extent taxpayers claim the deduction; fiscal impact would depend on number of eligible taxpayers and amounts claimed (no fiscal estimate included in the bill text).
- Implementation questions: the bill references a federal Code section for the definition of “self‑employed individual”; administrative guidance may be needed to clarify eligibility and interaction with federal deductions.
Unrelated material in bill file
- The file also contains language that would repeal South Carolina Code provisions concerning nonprescription ephedrine/pseudoephedrine sales and an electronic monitoring system; this language appears misplaced and is not part of the Massachusetts petition filed by Rep. Ayers.
Compiled from official sources — confirm details with the bill’s official record.
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