AARP supports Social Security tax relief & LTC savings plan measures

Shane Dwyer

At a Jan. 20 hearing before the Legislature’s Revenue Committee, AARP expressed support for a pair of bills that impact the financial security of older Nebraskans.

LB 749 would increase the number of retirees who are exempt from paying state income tax on Social Security benefits. Mark Intermill, advocacy director for AARP Nebraska, said the association supports the bill in principle, and believes there is some room in the state budget for Social Security income tax relief this year, especially for middle-income taxpayers.

“We appreciate legislative action two years ago to exempt Social Security benefits from state income taxes for some beneficiaries. Those changes helped bring the threshold for taxation of benefits closer to inflation-adjusted levels. At that time, there had been no adjustments for inflation since 1984, squeezing older Nebraskans on fixed incomes,” he said.

Intermill added that the committee needs to continue progress made in 2014, so that the threshold for taxing Social Security benefits is more in line with the inflation-adjusted amount originally set in 1984.

AARP also did not oppose LB 756 to eliminate Nebraska’s tax-deductible Long-Term Care Savings Plan. Intermill said that while AARP supported enactment of the plan in 2006, it has not done much to help Nebraskans save for their long-term care costs.

“Repealing the Long-Term Care Savings Plan provides us with an opportunity to take a new look at other state government options encouraging people to prepare for their long-term care expenses,” he said.

One approach is to develop a program providing consumers with objective information about long-term care risks and insurance options, similar to the highly successful Senior Health Insurance Information Program for Medicare. State Sen. Kate Bolz has introduced LB 801 to create such a program for long-term care.