Tax Deductions for Responsible Long Term Care Planners
Besides accessibility to topnotch long term care services or facilities, planning your future health care needs will also result in big long term care tax deductions.
According to financial advisers, long term care (LTC) is the biggest threat to every person’s finances these days and this explains why they along with the government and elder care specialists constantly encourage everybody to start an LTC plan early on in their lives.
LTC planning can’t be done overnight as there are so many important factors that need to be considered to ensure that one’s plan will suit his needs. One of these important factors which an individual has to address immediately is the type of care that he will most probably need someday.
Guessing is not encouraged in LTC planning. You cannot just guess what you’ll need in the future otherwise you will end up throwing away your hard earned money. For you to know how your health would turn out 30 or 40 years from now, see your doctor and have your present health condition assessed. You can also ask your doctor how your family’s health history can affect your future health.
If no one in your family had died of a chronic illness but you smoke and drink regularly, ask your doctor the possible geriatric diseases which you may possibly acquire.
Apart from your future health requirements, other things that you have to consider are LTC facilities which you might need, cost of care in your area, and for how long you will require care because all of these are essential to your plan.
Your Planning Template Determines Your Long Term Care Tax Deductions
There are many different ways to plan your LTC but experts say the best way to do it is to buy a long term care insurance (LTCI) policy.
With this type of insurance product, you are free to choose where you want to receive care someday when you’re no longer capable of performing the most basic activities of daily living (ADL) such as eating, bathing, dressing, toilet usage, continence, and transferring among others.
Owners of LTCI policies can opt to stay home and hire a home health aide to assist them in their ADLs at the onset of care. In case their condition gets worse later on and they would require more assistance in a number of activities they can ask to be moved to an assisted living facility or adult day care health center, or even to a nursing home and receive full coverage from their policies.
Having an LTCI policy gives you the privilege to demand for anything in line with your health care needs for as long as your demands are covered by your policy.
Aside from finding yourself on the receiving end of the best LTC services, you can also enjoy tax breaks from your LTCI policy. Based on the Internal Revenue Code 213(d), premiums paid for a tax-qualified LTCI policy are considered medical expenses but the amount of premium that shall be treated as medical expense would depend on your age at the end of the taxable year and the eligible premium amount which corresponds to your age.
Long term care is expensive but with the right plan it’s manageable. Take time to contact a licensed LTCI representative in your area to find out how you can benefit from long term care tax deductions.
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