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Committee sends bill expanding medical expense deduction to suspense file
Summary
AB 1282 would create a state tax deduction for out-of-pocket medical costs up to $5,000 (the bill text as read included a dated limitation shown in the hearing transcript). The sponsor said the change aims to ease medical debt for low-income Californians. The committee referred the bill to its suspense file.
Assemblymember Gonzales introduced AB 1282, which would create a state tax deduction for out-of-pocket medical costs, with a limit read into the record of $5,000 and a dated limitation as presented during testimony.
The sponsor said California has a high supplemental poverty rate and that medical debt affects a significant share of residents, citing studies that show high levels of medical debt and a large share of Californians living near poverty.
Committee members generally voiced support for the bill’s intent and asked technical questions about the deduction and its interaction with federal and state itemizing rules following passage of the federal Tax Cuts and Jobs Act (TCJA). The sponsor said itemizing would allow taxpayers and their tax preparers to account for medical expenses in a more detailed way than the standard deduction in some circumstances.
No witnesses registered opposition during the hearing. The committee chair announced AB 1282 would be referred to the suspense file for fiscal review and further consideration.
