FYI: HELPS

[TAG]

FYI: The HELPS Retirees Act allows a yearly distribution of up to $ 3,000 pretax from a governmental defined-benefit pension plan to retired public safety officers for use toward health care insurance and/or long-term care premiums.

[TAXBILLY]

Happened back in 2007.

taxbilly

[Jack from Ohio]

The Healthcare Enhancement for Local Public Safety (HELPS)Retirees Act was signed into law on August 17, 2006 as part of the PensionProtection Act of 2006. The HELPS Retirees Act takes effect on January 1, 2007 and will allow a yearly disbursement of up to $3,000 pre-tax from a governmental defined benefit pension, 403(b )or 457 plan to retired public safety officers for use toward health care insurance premiums. The disbursements, which will be made directly to insurance and health care providers, will be tax-free. Prior to the HELPS Retirees Act, when retirees paid for their health insurance premium, it was paid with out of their pockets with after-tax dollars. Beginning in January 1, 2007, eligible public safety retirees will be able to use pre-tax dollars from their qualified pension plans to pay for insurance premiums. If they are in the 28 percent federal marginal tax rate bracket, this could be a tax savings credit on their Adjusted Gross Annual Income of up to $840 per year! This special tax exclusion must be elected by each retiree.