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Senator proposes state tax deduction for individual health insurance premiums
Summary
Senate Bill 183 would let individuals deduct the cost of their health insurance premiums from state taxable income; proponents say it would ease rising marketplace costs and reduce medical debt, while fiscal effects will be analyzed in the state forecast.
Senate Bill 183, introduced by Senator Young, would allow taxpayers to deduct premiums paid for individual health insurance from state taxable income beginning with the 2027 tax year. In committee testimony, proponents said the change would help Hoosiers facing sharply higher marketplace premiums and could reduce medical debt and delayed care.
Olivia Smith of the Indiana Community Action Poverty Institute testified in support and estimated modest household savings under likely premium scenarios — a few hundred dollars a year — while acknowledging the bill’s fiscal impact will be clearer once the state budget office models the change for the next biennial forecast. Senator Young said he intentionally scheduled the measure so its budget effects would be visible for the next forecast cycle before full implementation.
The committee did not vote on SB183 in the meeting; the bill was presented and received initial testimony and discussion.
