BILL REQ. #:  H-1210.1 

Read first time 01/30/09.   Referred to Committee on Health Care & Wellness.

     AN ACT Relating to providing tax incentives for the purchase of health care plans; adding new sections to chapter 82.04 RCW; adding a new section to chapter 48.14 RCW; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   A new section is added to chapter 82.04 RCW to read as follows:
     In computing the tax imposed under this chapter, a person conducting business as a sole proprietorship may credit against the tax imposed by this chapter fifty percent of the value paid during the reporting period for health insurance premiums. The credit may not exceed the tax otherwise due under this chapter for the reporting period. Unused credit may be carried over and used in subsequent tax reporting periods. No refunds are granted for credits under this section.

NEW SECTION.  Sec. 2   A new section is added to chapter 82.04 RCW to read as follows:
     (1) In computing the tax imposed under this chapter, a credit is allowed against the amount of tax otherwise due under this chapter for fifty percent of the amount paid by small employers to provide health care services for its employees during the reporting period. The credit may not exceed the tax otherwise due under this chapter for the reporting period. Payments made by employees are not eligible for credit under this section.
     (2) For the purposes of this section, the following definitions apply:
     (a) "Small employer" means a person as defined in RCW 82.04.030 that employs an average of at least two but not more than one hundred fifty employees; and
     (b) "Health care services" means a health benefit plan as defined in RCW 48.43.005, contributions to health savings accounts as defined by the United States internal revenue service, or other health care services purchased by the small employer for its employees.
     (3) A small employer taking a credit under this section must keep records necessary for the department to verify eligibility under this section.

NEW SECTION.  Sec. 3   A new section is added to chapter 48.14 RCW to read as follows:
     (1) The taxes imposed in RCW 48.14.020 and 48.14.0201 do not apply to premiums and prepayments collected or received for high deductible health plans sold or maintained in connection with a health savings account under the applicable provisions of Title 26 U.S.C. Sec. 223 of the federal internal revenue code.
     (2) An insurer receiving an exemption under this section shall reduce premiums and prepayments collected or received by an amount equal to the exemption.
     (3) An insurer taking an exemption under this section must keep records necessary for the commissioner to verify eligibility under this section.

NEW SECTION.  Sec. 4   This act takes effect August 1, 2009.