Missouri Senate backs income tax break for long-term healthcare savings

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JEFFERSON CITY, Mo. — The Missouri Senate passed legislation Thursday that would provide a new tax incentive for people to save money for long-term care expenses of the chronically ill.

The bill would allow individuals to deduct up to $4,000 annually, and married couples up to $8,000, from their state income taxes for money placed in a “long-term dignity savings account.” The concept is similar to state tax breaks that already exist for college savings accounts.

The tax-free accounts could be opened beginning in 2021 and could used for a person’s own future care or for that of someone else.

The bill now goes to the House for consideration.

Legislative researchers estimate the bill could result in a loss of around $5 million annually in state tax revenues.

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