2016 IRS Eligible Long Term Care Insurance Premium

Here are the 2016 tax deductible limits for eligible long-term care insurance premiums.

Attained Age as of 12/31/2016

40 or less                                                             $  390

More than 40 but not more than 50              $  730

More than 50 but not more than 60              $1,460

More than 60 but not more than 70              $3,900

More than 70                                                      $4,870

Source: IRS Revenue Procedure 2015-33

For calendar year 2016 the per-diem limitation for periodic payments received under a qualified long-term care insurance contract remains at $340. (IRC Sections 104(a)(3), 7702B(a)(2), 7702B(d))

To itemize medical expenses, individuals must have eligible expenses not covered by health insurance that exceed 10 percent of their adjusted gross income.

HSA and MSA – Eligible LTCi Premium (table above) – qualified medical expense (IRC Code section 213(d)(1)(D).  

Self-employed, S-corporation (greater than 2% shareholder) and Partnership (greater than 2% shareholder) (table above) – health insurance deduction which can be taken “above the line” Line 29 of IRS From 1040. IRC section 162(l)

Many states have tax credits and deductions.  Maryland has a tax deduction of up to $500 of the above eligible long-term care insurance premiums.  For details on this, contact your tax advisor or www.baygroupinsurance.com

This information is a summary and is provided with the understanding that it is not to be interpreted as specific legal or tax advice.  You are encourage to see the guidance of your own personal legal and tax counsel.