Los Angeles, CA (PressExposure) June 12, 2011 -- The cost of long-term health care insurance may be fully tax deductible according to long-term care insurance expert Jesse Slome.
The author of the Guide To Tax Deductible Long-Term Care Insurance, published by the American Association for Long-Term Care Insurance http://www.aaltci.org, notes that the vast majority of consumers and even many accountants and tax professionals are not fully aware of the current tax rules.
In general individual taxpayers who itemize their tax deductions can treat premiums paid for tax-qualified long-term care insurance as a personal medical expense. The tax-deductible limit is based on the person's attained age. For 2011, Slome, who is AALTCI's executive director, points out that the per-person tax-deductible limit ranges from a low of $340 to as much as $4,240. The levels change from year to year.
The book points out that Federal and State governments are offering increased tax incentives to motivate more Americans to purchase protection. "The costs of long-term care financially devastate many and force people into public welfare programs that are already cash-strapped," Slome notes. Some 8.1 million Americans currently have long-term care insurance purchased on an individual basis or through their employer.
According to the book, self-employed individuals can deduct tax-qualified long-term care insurance premiums as a trade or business expense similar to traditional health and accident insurance. explains tax rules for individuals as well as those who are self-employed or own small businesses. The applicable rules vary including limits for allowable tax deductions.
"Small business owners may be able to take advantage of special tax rules that may make the full cost of long-term care insurance federally tax deductible," Slome adds. "The business may be able to pay for spouses and designate coverage for selected employees on a tax-advantaged basis."
A growing number of states are offering deductions and tax credits to individuals who purchase long term care insurance. That may be one of the reasons that some 475,000 Americans obtained new coverage last year, Slome concludes.