One Tax Deduction that Can Help You Save Money

tax2Preparing and filing taxes is a drag. What’s worse is missing a hefty tax deduction. Here’s one deduction that will potentially save you thousands of dollars. You don’t want to overlook it.

Significant savings
The government offers tax incentives to encourage Americans to take responsibility for their future long-term care needs. You can possibly write off medical expenses, including long-term care insurance premiums, if you itemize deductions. For the 2013 tax-filing year, you may deduct only the amount by which your total medical expenses exceed 10% of your adjusted gross income or 7.5% if you or your spouse is 65 or older.

The amount of qualified long-term care premiums you can include as medical expenses is limited up to the following amounts:

Taxpayers Age at End of Tax Year

Deductible Limit
40 or younger $360
41 to 50 $680
51 to 60 $1,360
61 to 70 $3,640
71 or older $4,550

Sources: IRS and American Association for Long-Term Care Insurance.

If you own a long-term care insurance policy, don’t forget this potential tax deduction. On the other hand, if you don’t own a policy, this tax savings serves as a big reason to consider one.

Click here to read the full article.

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