Last Month, a Bipartisan Group of U.S. Senators Introduced the Companion Bill to the Congresswoman’s “Wally Bunker HELPS Retirees Improvement Act”
The Legislation Would Allow More Retired First Responders to Access a Tax Benefit to Help Cover the Cost of Their Health & Long-Term Care Insurance
WASHINGTON, D.C. – The U.S. Senate Finance Committee today voted to pass the companion bill to U.S. Representative Abigail Spanberger’s Wally Bunker HELPS Retirees Improvement Act as part of the Enhancing American Retirement Now (EARN) Act. Last month, a bipartisan group of U.S. Senators introduced this U.S. Senate version to further Spanberger’s push to make sure that all retired police officers and firefighters can access a key tax benefit to pay for the health coverage they have earned.
Spanberger introduced the bipartisan Wally Bunker HELPS Retirees Improvement Act earlier this year to remove the requirement that pension fund distributions must go directly to the insurer to be eligible for tax-free status. The legislation is named after Wally Bunker, a 74-year-old retired police officer now living in Culpeper, Virginia. Mr. Bunker was a Police Lieutenant for the Suffolk Police Department in Suffolk, Virginia for nearly 22 years, where he served in patrol, investigations, internal affairs, communications, and undercover cases. In his retirement, he has been blocked from accessing a critical tax benefit to help pay for his health and long-term insurance.
“America’s first responders go above and beyond to keep our communities and neighbors safe. When the intense physical and psychological demands of the job force some of these brave men and women to retire early, they should not be penalized” said Spanberger. “To make sure that these local heroes are not left without coverage, we must make sure that retired officers can use tax-free payments from their pension plans to cover health insurance costs. Today moves us one step closer to securing this tax benefit for every retired officer — in Virginia and across the country — who earned it. I am grateful to the U.S. Senators who recognized the need to remedy this issue and took action by passing this bill out of committee.”
Many police officers — like Wally Bunker — and firefighters retire early because of the intense demands and unique hazards they face on the job. Unfortunately, with this early exit from the field, many lose access to their employer-sponsored health coverage but are still years away from being eligible for Medicare. To alleviate the burden of paying out-of-pocket for health insurance, Congress enacted the Healthcare Enhancement for Local Public Safety (HELPS) Retirees Act to allow retired officers to withdraw $3,000 tax-free from their pension plan annually to pay health or long-term care insurance premiums. However, the 2006 law required that pension plans pay the $3,000 directly to the insurer — but many smaller pension plans use a third-party system for disbursing payments, therefore preventing many retirees from accessing the benefit.
Last month, Spanberger spoke on the U.S. House floor to recognize Mr. Bunker and urge her House colleagues to support her legislation in his name.
Both the U.S. House and U.S. Senate versions have been endorsed by the National Fraternal Order of Police, National Association of Police Organizations, and International Association of Fire Fighters.