The Potential Tax Implications Of Long-term Care Insurance
There are all kinds of implications what sorts of things a person includes as part of their long-term care planning can have. This includes tax implications.
For example, having long-term care insurance as part of one's overall long-term care planning could qualify a person for a federal tax deduction. Under certain circumstances, a person may be able to take a tax deduction for some of the premiums they pay for such insurance. As note, this deduction does have some complicated eligibility rules and thus there are a variety of things that can affect whether or not a person would be able to take a tax deduction in relation to a long-term care insurance plan they have.
The maximum amount a person who qualifies for the above-mentioned deduction can deduct shifts based on a person's age. Generally, the older a person is, the higher their maximum deduction amount is. As a note, the Internal Revenue Service has announced that, for 2016, there would be across-the-board increases in maximum deduction amount for long-term care costs.
What sorts of tax deductions a person may qualify for in relation to long-term care insurance could impact what the overall financial effects of having long-term care insurance would be for them. This, in turn, could impact what the best overall setup would be for their long-term care planning.
Given how many different factors can affect what kinds of things it would be best for a person to include in their long-term care planning, the guidance of a skilled and experienced attorney can be a real asset when trying to decide what to do when it comes to long-term care planning.
Source: Bankrate, "IRS raises deductions for long-term care," Jennie L. Phipps, Nov. 17, 2015