House Bill No. 184, introduced by Representative Owen, proposes to authorize an individual income tax deduction for qualifying taxpayers who receive hardship distributions from retirement accounts. The bill enacts new provisions under R.S. 47:293(9)(a)(xxvii) and 297.26, which define "hardship distribution" as a withdrawal made due to an immediate and serious financial need, and "qualifying taxpayer" as an individual diagnosed with a terminal illness by a licensed physician. For married joint filers, the definition extends to include a spouse diagnosed with a terminal illness.

The bill specifies that the deduction will apply to taxable periods beginning on or after January 1, 2026, and will become effective on that same date. This legislation aims to provide financial relief to individuals facing significant health challenges by allowing them to deduct certain amounts received from their retirement accounts during times of hardship.