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If your senior clients are daunted by the high premiums of long
term care insurance, they should know that the government offers
tax deductions to encourage them to buy long term care policies
and take a more active role in their future care. With the tax deductions
offered, your clients may find that long term care insurance may
be more affordable than they realize and you can increase your long
term care insurance sales.
The Health Insurance Portability and Accountability Act of 1996
(HIPPA) provided that long term care insurance contracts should
receive the same favorable income tax treatment as health insurance
contracts. This helps the attractiveness of the long term care policies.
Here are some tax benefits pertaining to long-term care policies:
Long term care insurance premiums paid for a tax-qualified long
term care insurance policy is tax deductible as a medical expense,
subject to the 7.5% of adjusted gross income for medical expenses.
The amount that qualified for the medical expense deduction is limited
according to the age of the insured.
Premiums for qualified long-term care policies can be deducted
as a medical expense, subject to the general 7.5% of adjusted gross
income for medical expenses. However, the amount that qualifies
for the medical expense deduction is limited according to the age
of the insured. The IRS has listed the qualified deduction in 2003
as:
Age Before Close of Tax Year Limitation
40 or less $250
41 to 50 $470
51 to 60 $940
61 to 70 $2,510
More than 70 $3,130
Long-term care expenses not covered by insurance are deductible
as medical expenses (subject to the 7.5% of AGI floor).
Contact us today and join our team
as an independent long term care insurance agent or long term care
insurance broker. We are the long term care insurance specialists
that can help you increase your long term care insurance sales!
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