Individual Tax Payers

Deductibility of Premium Payments
Individuals who purchase and pay for Tax-Qualified Long-Term Care Insurance policies for themselves, their spouses, and their tax dependents may claim the premiums paid as deductible personal medical expenses if the Individual itemizes his or her taxes (See Internal Revenue Code (IRC) Sec. 213(a) and IRC Sec. 213(d)(1)(D)).

However, any TQ LTCI expenses are deductible only to the extent that the individual's unreimbursed medical care expenses exceed 10% of the individual's adjusted gross income (AGI); (7.5% for people age 65 and older through 2016).

Further, the amount of the Tax-Qualified Long-Term Care Insurance premiums that may be deducted is subject to the following dollar limits based on the insured's attained age before the close of the tax year (IRC Sec 213(d)(10)).

Age Eligible Premium 2017 Limit Eligible Premium 2016 Limit
40 and Younger
$410
$390
41 - 50
$770
$730
51 - 60
$1,530
$1,460
61 - 70
$4,090
$3,900
71 and Older
$5,110
$4,870

We do not provide tax or legal advice. Any decisions whether to implement these ideas should be made by the client in consultation with professional financial, tax, and legal counsel.