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The American Association for Long Term Care Insurance (AALTCI) has recently published the new long term care tax deductions limits for certain types of LTC plans. The guide, which is published annually, is being used by over 1 million professionals in the insurance industry.
According to Jesse Slome, Executive Director of AALTCI, the new guide of LTC plans tax deductions would surely benefit business owners, especially those who are running small and mid-sized businesses.
Individuals who are also LTC plan holders would also benefits with these deductions particularly after their retirement. Since their income would become lesser once they retire from their work, being entitled to tax deductions will become more possible for the person. And this includes deductions of the monthly premiums of certain LTC policies.
Since LTC premiums are considered as health-related expense, an individual will be given applicable tax deductibles based on his age and according to the new and latest tax limits being offered.
The tax deductions in the monthly premiums of LTC plans is just one of the many benefits that owning an LTC plan can provide the policyholders. This is more beneficial to those individuals who are no longer capable of working and have no strong or stable financial resources to compensate for the LTC services that they will use. Through the tax limits that are yearly updated, they are given the appropriate deduction based on their age when they started using their policy benefits.
Below is the list of the latest long term care tax deductions limit based on the guides that were published by AALTCI:
For Self-employed Individuals:
Age 40 and below – $350
Age 41 to 50 – $660
Age 51 to 60 – $1,310
Age 61 to 70 – $3,500
Age 71 and above – $4,370
For Owners of Partnerships, Subchapter S Corporations, and LLCs:
It is not mandatory to meet the 7.5 percent of AGI limit. Partners, members, and shareholders may deduct the amount based on the tax limit on their tax return.
For Owners of Subchapter C Corporations:
A 100 percent tax deduction may be given to any subchapter C Corporation that purchased LTC plans on behalf of its employees and dependents. It can be considered as a business expense and therefore entitled for particular tax deductions. However, the tax deductions may not be based on the limits stated above and in fact, employers may even choose and select the kinds of employees that they want to receive certain LTC insurance benefits.
Private sectors, as well as its counterparts in the government that favor the purchase of LTC insurance plans are confident that through these new tax limits, more and more residents would be encouraged and convinced to avail their insurance plans as early as possible. They also push insurance agents and elder care specialists to continuously inform their current and potential clients of this information so that they could better decide on what type of policy to buy.
With the help of these guidelines with regards to long term care tax deductions, individuals, as well as business owners alike, will surely benefit from it, giving them no reason to delay or postpone their plan acquisition.
Article Source: sooperarticles.com/finance-articles/insurance-articles/2012-long-term-care-tax-deductions-820038.html
Have you been trapped in paying for care services for you or a loved one? Did you know that a ignoring the red flag could lead you to despair as health services are rising every year? Planning for long term care is the wisest decision to protect both your future health and finances, and this can be done by securing a long term care plan.
Author: Meredith Colee