LONG-TERM CARE INSURANCE

Click here for IRS LTC Insurance Premium Deductibility.

There are several ways in which you may be able to deduct your long-term care premiums from your taxable income.

You are allowed to deduct amounts premiums paid (in excess of 7.5% of your adjusted gross income) for medical care for yourself, spouse, or dependent.  Medical care includes premiums paid for qualified long-term care contracts per 26 USCA Sec. 7702B (b).  Eligible long-term care premiums are premiums paid during a taxable year for a qualified long-term care insurance contract, but only to the extent the amount of premiums do not exceed statutory limitations per 26 USCA Sec. 213, IRC Sec. 213 (see table below).

You can receive tax-free distributions from your Health Savings Account (HSA) to pay or be reimbursed for qualified medical expenses you incur.  IRS Publication 969 (2008) states on page 8 that long-term care insurance premiums qualify as a tax-free distribution from your HSA.

[The IRS reminds you that you cannot deduct qualified medical expenses as an itemized deduction on Schedule A (Form 1040) that are equal to the tax-free distribution from your HSA.]

For taxable year beginning in 2015, the limitations under § 213(d) (10), regarding eligible long-term care premiums includible in the term “medical care,” are as follows:

Attained Age Before Close of Taxable Year

Maximum Deductible Limit

Age 40 or less:

$ 380

More than 40 but not more than 50:

$ 710

More than 50 but not more than 60:

$1,430

More than 60 but not more than 70:

$3,800

More than 70:

$4,750

Long-Term Care Insurance helps protect your savings and retirement assets, while preserving your freedom of who will take care of you and where.

You chose to have your coverage pay for your care in:

Your home
Assisted Living Facilities
Nursing Home

Plan designs are flexible to meet your care needs and personal budget.


Click here to request more information from a representative at Tucker & Shepley Benefits and Insurance.

 

 

 

 

 


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