The proposed bill, General Assembly Proposed Bill No. 5144, aims to amend section 12-701 of the general statutes to introduce a personal income tax deduction for certain payments received from insurance companies. Specifically, the bill allows taxpayers to deduct the portion of any payment received in exchange for a buyout or cancellation of a long-term care insurance policy, provided that this payment is also included in the taxpayer's gross income for federal income tax purposes.

This legislative change is intended to provide financial relief to individuals who opt for a buyout or cancellation of their long-term care insurance policies, recognizing the tax implications of such payments. The bill does not delete any existing legal language but rather adds new provisions to facilitate this tax deduction.