Long-Term Care Insurance Tax Deductions 2016 and Beyond
Author: ACSIA Partners LLC
Published: 2016/03/24 - Updated: 2026/01/20
Publication Type: Informative
Category Topic: Taxation - Related Publications
Page Content: Synopsis - Introduction - Main - Insights, Updates
Synopsis: This information provides essential guidance on federal tax deductions available to long-term care insurance policyholders, detailing IRS Section 213(d)(10) allowances that range from $390 for individuals aged 40 or younger to $4,870 for those over 70. The piece breaks down age-based deduction limits that recur annually, offering practical financial planning insights for anyone considering or currently holding long-term care coverage. For seniors and people with disabilities who face potential future care needs, understanding these deductions can make the difference between affording necessary coverage or going unprotected - particularly relevant given that only 10 percent of those who could benefit from such policies actually own one. The content serves as a valuable resource for making informed decisions about long-term care planning and maximizing available tax benefits - Disabled World (DW).
Introduction
If you're in the market for long-term care insurance, you may be suffering from sticker shock.
"The cost may seem out of reach," says Denise Gott. "Many people feel this way, so they put off protecting themselves. That's a shame, because in their case, Uncle Sam may pick up part of the tab." Gott is CEO of ACSIA Partners, one of the nation's largest long-term care insurance agencies.
Main Content
Federal tax deductions for owning long-term care insurance range from a few hundred to a few thousand dollars, and they're higher than ever in 2016.
"Not everyone qualifies," says Gott, "but everyone owes it to themselves to find out if they do and how big the deduction might be. For millions, the net policy cost will be at least a little less than the 'sticker price.'"
For the taxable year beginning in 2016, the limitations under Section 213(d)(10) of the IRS tax code, regarding eligible long-term care premiums includible in the term "medical care," are as follows:
Attained Age Before Close of Taxable Year / Limitation on Premiums:
- 40 or less: $390
- More than 40 but not more than 50: $730
- More than 50 but not more than 60 $1,460
- More than 60 but not more than 70: $3,900
- More than 70: $4,870
The deductions recur every year that one pays long-term care premiums, and have been increasing annually.
"The idea is to encourage Americans to protect themselves," says Gott. "Unfortunately only about 10 percent of those who could benefit from a policy actually have one. The percentage should be much higher. We think it would be if the deductions were taken into account."
Greater public awareness is vitally needed, and Gott's company is doing what it can to spread the word.
"We have over 150 long-term care specialists in all parts of the country. During tax season they're available to consult with anyone or their financial advisor by phone or in person."
ACSIA Partners LLC
ACSIA Partners LLC is one of America's largest and most experienced long-term care insurance agencies serving all states. The company is also a co-founder and sponsor of the "3in4 Need More" campaign, which encourages Americans to form a long-term care plan.
Insights, Analysis, and Developments
Editorial Note: The tax advantages outlined here represent more than just financial savings - they're a policy tool designed to encourage Americans to plan ahead for care needs that statistically affect three out of four people at some point. While these deductions have increased over time and continue to adjust annually, the low adoption rate of long-term care insurance suggests many people either don't know about these benefits or haven't calculated how much they could reduce their actual premium costs. For families navigating the complex intersection of healthcare planning, disability support, and financial security, taking time to consult with a tax advisor or insurance specialist about these deductions could translate into thousands of dollars in annual savings and, more importantly, peace of mind knowing that future care needs won't devastate household finances - Disabled World (DW).Attribution/Source(s): This quality-reviewed publication was selected for publishing by the editors of Disabled World (DW) due to its relevance to the disability community. Originally authored by ACSIA Partners LLC and published on 2016/03/24, this content may have been edited for style, clarity, or brevity.