Six Easy Steps to Lower Your Taxes
If you think only working parents have the privilege of lowering their taxable income owing to the fact that they are responsible for financially supporting their children, you need to read more for there is such a thing called long term care tax breaks which do not only benefit parents but childless individuals, as well.
Owners of long term care insurance (LTCI) policies can receive tax incentives through their annual premiums as these are treated as medical expenses by the Internal Revenue Services (IRS). Any medical expense is considered a deductible and thus for as long as you religiously pay the premium of your LTCI coverage you can look forward to huge income tax deductions regardless of your marital status.
If you have had your LTCI policy for quite some time now, chances are your deductible limit is higher than it was in previous years.
Your deductible limit is determined by your age at the end of the taxable year. For instance, a 51-year-old policyholder has managed to deduct his total annual premium of $640 from his income tax last year when he was only 50 years old. Now that he has turned a year older his total deductible limit is $1,310 based on the newly released tax deductible limits of the federal government.
Every year, the government makes it a point to increase the eligible deductible limit to keep pace with inflation. This means, the older a policyholder the higher his deductible limit.
If you want to join the league of insured individuals who are currently enjoying huge long term care tax deductions, below are six simple yet effective steps:
1. Contact an insurance agent who is authorized to sell LTCI policies and who works closely with the country’s leading LTCI carriers. If you’re not sure where to find one, approach the bureau of insurance in your state of residence.
2. Supply your agent with your personal information so that he can find the right coverage for you. Normally, his work starts with gathering of LTCI quotes from different carriers so see to it that you only provide him with factual information or else he might end up collecting the wrong choices.
3. Do not conceal any health-related information from your LTCI specialist for this will compromise your application for an LTCI policy. Take note that the underwriter of each LTCI company is very particular about the medical condition of an applicant so better be honest with your agent so that he can figure out how to pre-qualify you.
4. Once you have received your LTCI quotes, take time to peruse each carefully. Be sure that you do not overlook words in fine print as these stipulate the condition for coverage.
5. Once you have picked a specific type of policy, study it very well during the free look period. This is the length of time which an insurance company gives an individual for him to study the benefits and premium rate stated on his policy.
6. If you decide to buy the policy, organize your finances so that you will not encounter any problem with your premium. Regular premium payments will guarantee huge annual tax deductions.
Offering long term care tax breaks is the government’s way of encouraging people to plan their future health care needs in order to avoid the pangs of LTC costs. Without this type of incentive, there would probably be more uninsured Americans.
Get loads of information about long term care such as long term care insurance costs. We also offer free long term care quote when you visit our website now.
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