Tax deductible limits for long term care insurance purchased in 2012 have been increased over the 2011 deductible levels, according to the American Association for Long Term Care Insurance, the national trade group.
The Association’s executive director, Jesse Slome, announced the increased deductibility levels established by the IRS to 3,000 members of the trade group. “For taxable years beginning in 2012, a couple can deduct as much as $8,740,” Slome says. The limitations have been increased for all age bands and are greatest for those age 70 or older.
Slome told NewsBlaze, “Tax advantaged long-term care insurance remains one of the few remaining significant tax-savings benefits especially meaningful for small business owners. Businesses may be able to deduct the full cost of long-term care insurance for employees and even cover spouses and family members.”
The 2012 deductible limits under Section 213(d)(10) for eligible long-term care premiums includable in the term ‘medical care’ are as follows:
40 or less – $350
More than 40 but not more than 50 – $660
More than 50 but not more than 60 – $1,310
More than 60 but not more than 70 – $3,500
More than 70 – $4,370
Over eight million Americans currently own long term care insurance purchased on an individual basis or through a plan offered by their employer according to AALTCI. Slome says projections show that “some 500,000 new individuals will purchase this important protection in 2011. The government increases the tax deductible levels each year as a way to make this protection more attractive to consumers.
A complete explanation of tax deductible rules for individuals and business owners can be found on the Association’s website www.aaltci.org/tax. In addition to current and prior year limits, a growing number of states now offer tax credits or deductions to encourage the purchase of long-term care insurance.
To contact Jesse Slome, the Executive Director at the American Association for Long-Term Care Insurance, call (818) 597-3227.
