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HB 327

Income Tax - Credit for Long-Term Care Premiums (Long-Term Care Relief Act of 2025)

2025 Regular Session Introduced by Vaughn Stewart

Maryland would offer state income tax credits to residents purchasing long-term care insurance, reducing tax liability to make premiums more affordable and decrease future Medicaid spending.

Hearing 1/30 at 1:00 p.m.
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WeVote Research Nonpartisan
Bill Summary · HB 327

Legislative bill overview

HB 327 would create a state income tax credit for Maryland residents who pay premiums for qualified long-term care insurance policies. The credit would reduce the amount of state income tax owed by eligible taxpayers, effectively subsidizing long-term care insurance costs through the tax system. The bill aims to encourage Marylanders to purchase long-term care coverage before they need it.

Why is this important

Long-term care (nursing homes, assisted living, in-home care) is extremely expensive and can devastate family finances. By making premiums more affordable through tax credits, the bill could reduce the number of people who deplete their savings and turn to Medicaid for coverage, potentially lowering state Medicaid costs long-term. However, the immediate impact would be foregone state tax revenue that must be compensated through other means.

Potential points of contention

  • Revenue cost: The state must account for lost tax revenue from this credit; legislators will debate whether this is fiscally sustainable or should be offset by spending cuts/revenue increases elsewhere
  • Regressive benefit structure: Tax credits primarily benefit higher-income individuals who can afford premiums and have tax liability; lower-income Marylanders may see minimal benefit despite having the greatest need for long-term care assistance
  • Policy design specifics: The bill's exact credit amount, income limits, qualifying policy requirements, and effective date are not detailed here but will significantly affect both cost and accessibility

Compiled from official sources — confirm details with the bill’s official record.

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