Remind Your Retirees About the HELPS Insurance Credit

Retired law enforcement and fire/EMS members may be eligible to reduce their taxable income by up to $3,000 per year for medical insurance premiums paid.

This benefit is available under the Healthcare Enhancement for Local Public Safety Retirees (HELPS) Act.

Previously, retirees were required to have insurance premiums deducted directly from their pension checks to qualify. However, under the federal Secure 2.0 retirement law, that restriction has been removed.

Now, qualifying premiums paid directly for health, accident, or long-term care insurance are eligible for the credit starting with the 2023 tax year and beyond.

Important Details to Share

• The $3,000 reduction does not appear on the retiree’s 1099-R form.
• Retirees must claim the reduction on their personal 1040 tax return (Line 5B or similar adjustment).
• Instructions can be found in IRS Publication 575 (page 7, with updates on page 2).
• Married couples where both spouses are retired police, fire, or EMS may claim up to a $6,000 reduction.

Because this process can be complex, retirees should consult their tax preparer or financial advisor to ensure the credit is properly applied.

Let’s do what we can to help our retired members take advantage of this valuable tax benefit.

Dan Ryan, Illinois Public Pension Fund Association (dan.ryan@ippfa.org)

IPPFA | Contact Us | Privacy Policy