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The professionals at Advanced Underwriting Consultants (AUC) answer the tax and technical questions posed by producers. Here’s the question of the day.
Question: Are long term care insurance premiums paid by an individual tax deductible from a federal income tax perspective?
Answer: Possibly, but only for certain taxpayers, and the deduction may be limited.
Long term care premiums are potentially deductible as a medical expense. Medical expenses are deductible for taxpayers in 2011
- If the taxpayer itemizes deductions, and
- To the extent all deductible medical expenses exceed 7.5% of adjusted gross income.
The amount of the premium paid for long term care insurance that may be considered a medical expense is limited based on the taxpayer’s age. For example, for a 63 year old taxpayer in 2011, the maximum long term care premium potentially deductible is limited to $3,390.
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