HELPS II Legislation Introduced
March 11, 2009

On March 10, 2009, Representative Joe Crowley (D-NY) introduced the Healthcare Enhancement for Local Public Servants Act of 2009 (HELPS II). The bill, which amends the Internal Revenue Code of 1986 to allow certain public employees a deduction for distributions from governmental plans for health and long-term care insurance, is an extension of the Healthcare Enhancement for Local Public Safety Retirees Act (HELPS) that was signed into law as part of the Pension Protection Act of 1996.

H.R.1413, if passed, would allow all public employee retirees to use tax-free distributions from their qualified retirement plan to pay for healthcare and long-term care insurance premiums. Previously, under the orginial HELPS legislation, this benefit was available only to retired public safety personnel. The legislation also introduces additional provisions, such as survivor benefits, indexing of the $3,000 in distributions for insurance premiums to inflation, and removes the administrative responsibility from pension funds.

Representative John McHugh (R-NY) was an original co-sponsor of the bill on the minority side. The bill was referred to the House Ways and Means Committee.

To view the legislation as introduced, please click here.