ALBANY, N.Y., January 26 – Tax-free withdrawals from retirement IRAs and retirement annuities to pay for long-term care insurance premiums would be allowed under a bill introduced in the New York State Senate.

The legislation, introduced by Senator George D. Maziarz (R/C-Monroe), amends the Tax Law to exempt distributions from individual retirement accounts and individual retirement annuities from state personal taxation when distributions are used to purchase long-term health care insurance.

Planning for future long-term care needs is a goal that New York State continues to support as a way to save Medicaid dollars, and as a way for individuals to be able to manage their own care, Maziarz said. He added that different strategies and ideas need to be explored to encourage individuals to think in advance and plan for their personal long-term care needs.

Long-term insurance can be prohibitively costly for some individuals, yet these individuals may have a retirement IRA or retirement annuity that would afford them an opportunity to purchase long-term care insurance, Maziarz said. Authorizing tax free withdrawals from these accounts to cover the costs of long-term insurance premiums complies with the interest and goals of the state, and opens up an avenue of planning and affording long-term care insurance should ones monthly income not be sufficient to afford the premiums.

Assemblyman Steven Englebright (D-Suffolk) has introduced similar legislation in the Assembly.