Health Coverage Tax Credit (TAARA)

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States governments and the federal government offer tax credits to certain individuals to help defray the cost of their health care coverage in certain situations.  An important federal law, known as the Trade Adjustment Assistance Reform Act (TAARA) permits certain taxpayers to claim a tax credit toward purchase of health insurance regardless of the state they live in.  In very general terms, employees and retirees in businesses that 1) have gone out of business, 2) moved off-shore, or 3) reduced their work forces due to the impact of adverse trade policy and  individuals who receive pension checks through the Pension Benefit Guaranty Corporation are eligible to use the tax credit. The U.S. Department of Labor, the Pension Benefit Guaranty orporation (a federal corporation), and the Internal Revenue Service are responsible for the implementation of the health coverage tax credit.

Materials prepared by the Health Assistance Partnership and Families USA

• The Health Insurance Tax Credit in the Trade Adjustment Reform Act of 2002 (April 2003)
• Memo prepared by Health Assistance Partnership, regarding health care coverage for National Steel Retirees Under Age 65, revised September 10, 2003
  This memo was used to counsel National Steel retirees, but you can use the same format to create counseling materials when other businesses close due to trade.
• A Shelter in the Storm: How a Subsidy Could Help Unemployed Workers Get Health Insurance (October 2003)
• The Trade Act Health Insurance Subsidy: An Update from the States (December 2003) 
• When Retiree Health Insurance Disappears (April 2003)
  Notes from a conference call with State Health Insurance Programs (SHIPs)

U.S. Government Resources

Department of Labor

• Trade Act Programs:  TAA for Workers Links to Recent News, Fact Sheets, Contacts, Petitions, Determinations, Reemployment Services, Resource Room, Workers, Employers, Workforce Development Professionals, State On-Stop Web Sites

Internal Revenue Service

• Health Coverage Tax Credit Overview Links to information for individuals, state government representatives, and health plan administrators as well as a glossary, eligibility kit, list of qualigied plans and a list of frequently asked questions.

Pension Benefit Guaranty Corporation

• Trade Adjustment Act of 2002 Health Coverage Tax Credit Frequently Asked Questions

Government Accountability Office (GAO)

• Health Coverage Tax Credit: Simplified and More Timely Enrollment Process Could Increase Enrollment October 2004 Report