Overview
Title
To amend the Internal Revenue Code of 1986 to treat amounts paid for private umbilical cord blood, or umbilical cord tissue, banking services as medical care expenses.
ELI5 AI
H.R. 8882 is a plan to let people save money on their taxes if they pay for special banks to store something called umbilical cord blood and tissue, which are tiny bits from babies that can help with health in the future. To do this, the special banks must meet certain rules to be safe and good at what they do.
Summary AI
H.R. 8882 proposes an amendment to the Internal Revenue Code of 1986 to classify payments made for the storage of private umbilical cord blood or tissue as medical care expenses. This means that such payments could qualify for tax deductions when filed as medical expenses if the storage service is provided by an accredited bank in compliance with the Public Health Service Act. The bill, introduced by Mr. Arrington and Mr. Panetta, would take effect for taxable years starting after December 31, 2023.
Published
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AnalysisAI
The Family Cord Blood Banking Act is a legislative proposal introduced in the House of Representatives. This bill seeks to amend the Internal Revenue Code of 1986 to classify expenses related to private umbilical cord blood or tissue banking services as medical care expenses. If passed into law, this amendment would apply to tax years starting after December 31, 2023. The intended effect is to allow individuals using these services to potentially deduct the related costs as medical expenses on their federal taxes, thus reducing taxable income.
General Summary of the Bill
This bill introduces a change to the U.S. tax code that impacts how certain medical-related expenses are treated. More specifically, the bill aims to include payments made for the storage of umbilical cord blood and tissue as legitimate medical expenses under tax regulations, offering tax benefits for those who use these services. The inclusion applies only to services provided by accredited banks that comply with specific public health regulations.
Summary of Significant Issues
The bill raises several important issues:
Market Competition: Since the bill applies only to accredited banking services, it might unjustly favor larger and established banks that already meet these stringent requirements, potentially limiting smaller or newer banks from competing effectively in this market. This could restrict consumer choice.
Complexity of Language: The legal and technical language used in the bill could be difficult for the general public to understand. This complexity might hinder individuals from realizing the potential tax benefits without additional guidance or professional help.
Financial Implications: The bill does not address its impact on government revenue or taxpayer finances. Without a cost-benefit analysis, concerns may arise over how this change affects the budget or if it leads to higher taxes elsewhere to accommodate any shortfall.
Effective Transition: The effective date is set for tax years starting after December 31, 2023. There may be a need for clear transition rules to aid taxpayers in adopting these changes smoothly, avoiding confusion around implementation timing.
Impact on the Public
On a broad scale, the bill could ease the financial burden on families who opt for private cord blood banking by allowing these expenses to be deducted from their taxes, effectively reducing the overall cost. This could become an incentivizing factor for families considering these services.
Impact on Specific Stakeholders
Families and Individuals: Those looking to store umbilical cord blood or tissue may benefit significantly due to the potential tax deductions, making these medical services more accessible.
Umbilical Cord Blood Banking Services: Accredited banks could see increased business due to the tax incentives offered. However, new or smaller companies that struggle to meet accreditation requirements may find themselves at a disadvantage.
Government and Taxpayers: Without a detailed analysis, the fiscal impact remains uncertain. If many individuals take advantage of these deductions, it could lead to reduced tax revenue, which may necessitate adjustments elsewhere in the budget.
In conclusion, while the Family Cord Blood Banking Act presents potential financial advantages for families utilizing private banking services for umbilical cord blood and tissue, it also raises several issues concerning market fairness, clarity, and financial impact. Careful consideration and additional guidance could help address these concerns, ensuring the bill's benefits are realized broadly and equitably.
Issues
The provision to include private umbilical cord blood and tissue banking services as medical care expenses may favor specific accredited banks, which could limit competition to those that meet specific accreditation and compliance requirements as stipulated in Section 2(a). This may raise concerns about market fairness and accessibility for smaller or new banking services.
The potential lack of clarity in the amendment language to section 213(d) for individuals without legal or tax expertise might hinder understanding and effective implementation, as noted in Section 2(a). This suggests a need for a clearer or simplified explanation to ensure widespread comprehension and compliance.
There is no discussion on how the proposed changes will impact government revenue or taxpayers, as highlighted in Section 2. This omission could lead to concerns about potential financial implications without a detailed cost analysis, potentially affecting both government budgets and taxpayer finances.
The effective date for taxable years beginning after December 31, 2023, outlined in Section 2(b), might require additional guidance or transition rules for those affected, particularly during the time between the bill's passage and its implementation. This transition period could benefit from clearer guidelines to manage the change effectively.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of this Act, called the “Family Cord Blood Banking Act,” provides a short title that can be used to refer to the Act in a concise way.
2. Amounts paid for private umbilical cord blood, or umbilical cord tissue, banking services treated as medical care expenses Read Opens in new tab
Summary AI
The section amends the Internal Revenue Code to allow costs for private umbilical cord blood or tissue banking services to be considered medical care expenses if provided by an accredited bank. This change will apply to tax years starting after December 31, 2023.