2022 -- S 2757 | |
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LC005545 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2022 | |
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A N A C T | |
RELATING TO TAXATION - PERSONAL INCOME TAX | |
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Introduced By: Senators Miller, DiMario, Lawson, Valverde, and DiPalma | |
Date Introduced: March 24, 2022 | |
Referred To: Senate Finance | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Section 44-30-101 of the General Laws in Chapter 44-30 entitled "Personal |
2 | Income Tax" is hereby amended to read as follows: |
3 | 44-30-101. Requirements concerning qualifying health insurance coverage. |
4 | (a) Definitions. For purposes of this section: |
5 | (1) "Applicable individual" has the same meaning as set forth in 26 U.S.C. § 5000A(d). |
6 | (2) "Minimum essential coverage" has the same meaning as set forth in 26 U.S. C. § |
7 | 5000A(f). |
8 | (3) "Shared responsibility payment penalty" means the penalty imposed pursuant to |
9 | subsection (c) of this section. |
10 | (4) "Taxpayer" means any resident individual, as defined in § 44-30-5. |
11 | (b) Requirement to maintain minimum essential coverage. Every applicable individual |
12 | must maintain minimum essential coverage for each month beginning after December 31, 2019. |
13 | (c) Shared responsibility payment penalty imposed for failing to maintain minimum |
14 | essential coverage. As of January 1, 2020, every applicable individual required to file a personal |
15 | income tax return pursuant to § 44-30-51, shall indicate on the return, in a manner to be prescribed |
16 | by the tax administrator, whether and for what period of time during the relevant tax year the |
17 | individual and his or her spouse and dependents who are applicable individuals were covered by |
18 | minimum essential coverage. If a return submitted pursuant to this subsection fails to indicate that |
19 | coverage was in force or indicates that any applicable individuals did not have coverage in force, a |
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1 | shared responsibility payment penalty shall hereby be assessed as a tax on the return. |
2 | (d) Shared responsibility payment penalty calculation. Except as provided in subsection |
3 | (e), the shared responsibility payment penalty imposed shall be equal to a taxpayer's federal shared |
4 | responsibility payment for the taxable year under section 5000A of the Internal Revenue Code of |
5 | 1986, as amended, and as in effect on the 15th day of December 2017. |
6 | (e) Exceptions. |
7 | (1) Penalty cap. The amount of the shared responsibility payment penalty imposed under |
8 | this section shall be determined, if applicable, using the statewide average premium for bronze- |
9 | level plans offered through the Rhode Island health benefits exchange rather than the national |
10 | average premium for bronze-level plans. |
11 | (2) Hardship exemption determinations. Determinations as to hardship exemptions shall be |
12 | made by the exchange under § 42-157-11. |
13 | (3) Religious conscience exemption determinations. Determinations as to religious |
14 | conscience exemptions shall be made by the exchange under § 42-157-11. |
15 | (4) Taxpayers with gross income below state filing threshold. No penalty shall be imposed |
16 | under this section with respect to any applicable individual for any month during a calendar year if |
17 | the taxpayer's household income for the taxable year as described in section 1412(b)(1)(B) of the |
18 | Patient Protection and Affordable Care Act is less than the amount of gross income requiring the |
19 | taxpayer to file a return as set forth in § 44-30-51. |
20 | (5) Out of state residents. No penalty shall be imposed by this section with respect to any |
21 | applicable individual for any month during which the individual is a bona fide resident of another |
22 | state. |
23 | (f) Health insurance market integrity fund. The tax administrator is authorized to withhold |
24 | from any state tax refund due to the taxpayer an amount equal to the calculated shared responsibility |
25 | payment penalty and shall place those amounts in the health insurance market integrity fund created |
26 | pursuant to § 42-157.1-5. |
27 | (g) Deficiency. If, upon examination of a taxpayer's return, the tax administrator |
28 | determines there is a deficiency because any refund due to the taxpayer is insufficient to satisfy the |
29 | shared responsibility penalty or because there was no refund due, the tax administrator may notify |
30 | the taxpayer of the deficiency in accordance with § 44-30-81 and interest shall accrue on the |
31 | deficiency as set forth in § 44-30-84. All monies collected on the deficiency shall be placed in the |
32 | health insurance market integrity fund created pursuant to § 42-157.1-5. |
33 | (h) Application of federal law. The shared responsibility payment penalty shall be assessed |
34 | and collected as set forth in this chapter and, where applicable, consistent with regulations |
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1 | promulgated by the federal government, the exchange, and/or the tax administrator. Any federal |
2 | regulation implementing section 5000A of the Internal Revenue Code of 1986, as amended, and in |
3 | effect on the 15th day of December 2017, shall apply as though incorporated into the Rhode Island |
4 | code of regulations. Federal guidance interpreting these federal regulations shall similarly apply. |
5 | Except as provided in subsections (j) and (k) of this section, all references to federal law shall be |
6 | construed as references to federal law as in effect on December 15, 2017, including applicable |
7 | regulations and administrative guidance that were in effect as of that date. |
8 | (i) Unavailability of federal premium tax credits. For any taxable year in which federal |
9 | premium tax credits available pursuant to 26 U.S.C. section 36B become unavailable due to the |
10 | federal government repealing that section or failing to fund the premium tax credits, the shared |
11 | responsibility payment penalty under this section shall not be enforced. |
12 | (j) Imposition of federal shared responsibility payment. For any taxable year in which a |
13 | federal penalty under section 5000A of the Internal Revenue Code of 1986 is imposed on a taxpayer |
14 | in an amount comparable to the shared responsibility payment penalty assessed under this section, |
15 | the state penalty shall not be enforced. |
16 | (k) Agency coordination. Where applicable, the tax administrator shall implement this |
17 | section in consultation with the office of the health insurance commissioner, the office of |
18 | management and budget, the executive office of health and human services, and the Rhode Island |
19 | health benefits exchange. |
20 | (l) Data Sharing. |
21 | (1) Opt-In. Every applicable individual who indicates on a return that minimum essential |
22 | coverage required by subsection (b) of this section was not in force shall also indicate on the return, |
23 | in a manner prescribed by the tax administrator, whether the applicable individual consents to be |
24 | contacted directly by the Rhode Island health benefits exchange about enrollment in health |
25 | coverage. |
26 | (2) Information to be disclosed. The tax administrator, upon written request from the Rhode |
27 | Island health benefits exchange, shall disclose the following information to officers, employees, |
28 | and contractors of the Rhode Island health benefits exchange, with respect to any applicable |
29 | individual who has consented to be contacted directly pursuant to subsection (1) of this section, for |
30 | the applicable year: |
31 | (i) The name, age, mailing address, income and penalty amount due, if any, for the |
32 | consenting individual; and |
33 | (ii) If applicable, the information for the consenting individual’s spouse and dependents |
34 | for the applicable year. |
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1 | (iii) For purposes of this subsection, the term "applicable year" means the most recent |
2 | taxable year for which information is generally available in the Rhode Island department of |
3 | revenue's taxpayer data information systems, or, if there is no return filed for the individual for the |
4 | most recent taxable year, then the most recent taxable year in which the individual has filed a tax |
5 | return. |
6 | (iv) Restriction on use of disclosed information. Return information disclosed under this |
7 | subsection may be used only for the purposes authorized by this subsection and § 42-157-13. |
8 | (v) Privacy and security. The Rhode Island health benefits exchange and the tax |
9 | administrator shall develop a detailed set of data privacy and data security safeguards to govern the |
10 | conveyance of data between their agencies pursuant to the provisions of this subsection. With |
11 | respect to information disclosed by the tax administrator to the Rhode Island health benefits |
12 | exchange pursuant to this subsection, the Rhode Island health benefits exchange, its officers, |
13 | employees, and contractors, shall be subject to § 44-30-95(c). |
14 | SECTION 2. This act shall take effect upon passage. |
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LC005545 | |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO TAXATION - PERSONAL INCOME TAX | |
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1 | This act would provide that every individual who fails to maintain the minimum essential |
2 | health care coverage for an applicable tax year shall indicate on their tax return whether the |
3 | individual desires to be contacted by the Rhode Island health benefits exchange about enrollment |
4 | in health coverage. If the taxpayer consents then the information would be disclosed to the health |
5 | benefits exchange upon written request. |
6 | This act would take effect upon passage. |
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