IRS Long Term Care Deduction

Long Term Care Tax Deductions

One of the more frequently asked questions about long term care insurance is if you can’t afford the long term premiums are there any tax benefits to owning a long-term care policy that might help subsidize the premiums.

Here are some answers to those questions given by tax experts:

1. Long-term care premiums are deductible as a medical expense (subject to the 7.5 percent-of-AGI floor), although there are limits to the deduction based on the taxpayer’s age. For example, a taxpayer between ages 61 and 70 may deduct as much as $3,080 in 2008 ($3,180 in 2009). A couple filing a joint return can deduct as much as $6,160 in 2008, if each spouse pays premiums on qualified long-term care policies. Payments in excess of any LTC benefits may be deducted as medical expenses.