New Levels of Long Term Care Tax Deduction Released
There is another good news small time business owners, the Internal Revenue Service (IRS) has released the new set of long term care deduction levels for LTC insurance plans that were availed this year.
According to Jesse Slome, Executive director of the American Association for Long Term Care Insurance (AALTCI), the limitations for the tax deductions have been increased and this will eventually boost the morals of those who manage small time companies and senior individuals.
Insurance industry experts also see this as an opportunity to promote and further encourage other American residents who are currently not insured and do not own an LTC insurance policy to start considering of getting one that they can use for their future LTC needs.
These new sets and levels of tax deductions would also make the people realize that owning such is not really that expensive especially if it was planned and carefully analyzed beforehand. Now, there would be no more excuse for the people not to consider and think about their future LTC needs because the government are continuously developing and creating ways to provide them with more affordable options and possibilities for them to experience owning an LTC insurance plan.
Tax-qualified LTC insurance premiums are considered medical expenses, and these are deductible given that the insured person exceeds 7.5 percent of his Adjusted Gross Income (AGI). Based on the Internal Revenue Code 213(d), the LTC insurance premiums that is considered a medical expense is based on the age of the individual and any excess thereafter will not be covered and considered as medical expense.
For those who are 40 years old or less, their long term care tax deduction at the end of the year amounts to $340; 41 years old but not yet 51 will have $640 tax deductions; 51 but not yet 61 was granted $1,270 while those who are 61 but not yet 71 years old will have $3,390. Any LTC insurance plan that was acquired at age 71 and older will be given $4,240 tax deductions.
Some of the veterans in the insurance industry see this as an important innovation and development in the unending efforts of the government and some private insurance companies. They also consider this as a good opportunity to study and revise any term or conditions that LTC insurance plans currently have.
Also, they hope that in the future, the number of those who owns such insurance policies will increase and that younger individuals with strong financial resources and income will start to buy plans as early as possible to avoid being given an expensive rate of monthly premiums.
It is undoubtedly and undeniably true that our health is the biggest wealth that we can have in our lifetime. But it is also a fact that however we take good care of ourselves, we still cannot avoid being old and being sick in the future. And if we continue to receive good news like the latest levels of long term care tax deduction, it will be much easier for us to own an LTC plan.
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