Are There Any Tax Benefits Associated With Long-Term Care?

Yes. Under the Health Insurance Portability and Accountability Act of 1996, long­term care insurance policies that meet certain requirements become eligible for federal income tax advantages. These policies became known as Qualified Long­Term Care Insurance policies. Policies purchased through the end of 1996 were grand fathered under this new law which meant they automatically qualified for tax­favored treatment. Policies purchased after 1996 must be clearly identified as qualified Long­Term Care Insurance policies having met the requirements to be considered tax qualified. Consumers who have purchased a Qualified Long­Term Care Insurance Policy may deduct premiums as a medical expense for payments made in 2000, when they file their income tax return in 2001. It is recommended you contact your personal tax advisor for complete details before filing your return.

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