Wednesday, 2 January 2013

2013 IRS Tax Limits for Long-Term Care Insurance

2013 IRS Tax Limits for Long-Term Care Insurance :Individual taxpayers can treat premiums paid for tax-qualified long-term care insurance for themselves, their spouse or any tax dependents (such as parents) as a personal medical expense. The yearly maximum deductible amount for each individual depends on the insured's attained age at the close of the taxable year (see Table 1 for current limits). These deductible maximums are indexed and increase each year for inflation. 

 The Internal Revenue Service (IRS) announced increased deductibility levels for individuals purchasing long term care insurance policies purchased in 2013 (Rev Procedure 2012-41).

Attained Age before Close of Taxable year
40 or less $ 360
More than 40 but not more than 50$ 680
More than 50 but not more than 60$1,360
More than 60 but not more than 70$3,640
More than 70   $4,550

For calendar year 2013, the per-diem limitation under Section 7702B(d)(4) for periodic payments received under a qualified long-term care insurance contract is $320 (the 2012 limit was $310).