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
|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.
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