The state Senate unanimously passed a bill Tuesday to create a health insurance exemption from the income of parents with dependent children.
The bill is meant to align with the Patient Protection and Affordable Care Act, which allows children to stay on their parents' plan until age 26 and provides a federal tax exemption to the parents for the medical care they purchase for their children.
The bill, introduced by state Sen. Van Wanggaard, R-Racine, and state Rep. Pat Strachota , R-West Bend, would allow parents with dependent children to receive the same tax exemption at the state level that they do at the federal level.
""This was a hidden tax that many employees and employers were unaware of that would have been a burden on Wisconsin families and businesses at year-end,"" Wanggaard said in a statement.
Wisconsin is currently the only state that does not allow for this tax exemption. The plan would affect approximately 15,900 Wisconsin families, according to Andrew Welhouse, spokesperson for state Sen. Scott Fitzgerald, R-Horicon.
Strachota said the bill was originally going to be introduced in the budget, but was not because of a fiscal note error. After working on the bill for nearly a year, she added she is glad the bill is finally received a fair hearing.
""Once again, Wisconsin is doing what is necessary to do business in the state,"" Strachota said.
Executive director for the health care advocacy group ABC for Health Bobby Peterson said the bill would eliminate the concern over the state-tax liability many parents with dependent children have, which could have impeded many young adults from receiving health insurance.
""We should… try to make it as easy as possible to extend health coverage to a population that typically goes without insurance,"" Peterson said.
The Assembly is expected to vote on the bill next week and Strachota said she anticipates it will pass with bipartisan support.
