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Tax benefits can reduce your long-term care insurance costs

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Kelly BehnkeToday's blog headline may be especially true if you have a high-deductible health plan with a Health Savings Account (HSA), Health Reimbursement Account (HRA), or you own a small business.  

Long-term care insurance (LTCi) is an affordable way to protect yourself against the high cost of extended care that may be required if you have a serious illness, stroke, or accident. Without LTCi, you will need to pay for extended care with your personal savings and assets. Long-term care is generally not covered by Medicare, health insurance, or the new Affordable Care Act.

Members who pay LTCi costs may be able to subtract all or a portion of the cost of a long-term care insurance policy from their Wisconsin income taxes. You may also be able to include amounts paid for qualified contracts as a medical expense when itemizing deductions for federal income tax purposes.

Tax-qualified LTCi premiums may be reimbursed through an HSA. Reimbursements for insurance covering medical care expenses, which includes qualified long-term care services and qualified LTCi premiums, are generally allowable under a HRA.

If you or your spouse owns a business, you may be able to adopt an Internal Revenue Code Section 105 Plan. This may enable you and your spouse to deduct 100% of your premiums as a business expense.

Members should consult their tax accountant or attorney for detailed advice regarding their particular tax or financial situation.

Want to learn more about our LTCi program?

Kelly Behnke, CIC, CISR, ACSR

LTC insurance products are underwritten by multiple LTC providers. Program administered by LTCi Marketing Administrators Inc. (LiMA).