New Law HELPS Public Safety Retirees Cover Health Costs
The Healthcare Enhancement for Local Public Safety Officers (HELPS) Act is a new retiree health care benefit that provides a tax-free distribution of up to $3,000 from retirement plans to help retirees pay for health insurance or long-term care insurance.
The IRS has published new instructions on how retired fire fighters can take advantage of the Healthcare Enhancement for Local Public Safety (HELPS) benefit on their 2007 tax returns.
The IRS will allow retired fire fighters to exclude from income distributions made from eligible retirement plans up to $3,000 annually to pay the premiums for accident or health insurance or long-term care insurance. The premiums can be for coverage for the retiree, spouse or dependents. The distribution must be made directly from the retirement plan to the insurance provider. Eligible retirement plans include qualified trusts, section 403(a) plans, section 403(b) annuities and section 457(b) plans.
On December 26, 2007, the IRS officially changed its position to allow participants in self-insured plans to be eligible for the HELPS Retirees benefit. The HELPS Retirees Act allows qualified public safety officers to use up to $3,000 per year from their qualified retirement plans for health and long-term care insurance premiums.
The IAFF Web site offers an array of information, including Frequently Asked Questions, tax instructions and downloadable forms.
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