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Tax Benefits

Tax Benefits

Select a question below:

  • Are there any Federal tax benefits related to long term care insurance?
  • Yes. The Federal Long Term Care Insurance Program is designed to be a tax-qualified plan under the Internal Revenue Code. This means that:

    • Benefits (claims) are not taxable.
    • You can deduct your long term care insurance premiums as medical expenses on your federal tax return to the extent that your total qualified medical expenses exceed 10% of your annual adjusted gross income or 7.5% if you are age 65 or older. The 7.5% limitation is effective only from January 1, 2013, to December 31, 2016, for individuals who are age 65 and older.
    • The amount of long term care insurance premiums that you can include in your total medical expenses is subject to Internal Revenue Service (IRS) limits by age. Here are the current published IRS limits by age:
    Your age in years,
    attained before the
    close of the taxable year
    Maximum long term care insurance premiums you
    can include: tax year 2016
    Maximum long term care insurance premiums you
    can include: tax year 2017
    Age 40 or younger $390 $410
    Age 41 to 50 $730 $770
    Age 51 to 60 $1,460 $1,530
    Age 61 to 70 $3,900 $4,090
    Age 71 or older $4,870 $5,110
    Rates are subject to change each year as determined by the IRS. Please consult for the latest tax deduction information.

    This is not intended to provide tax advice. Always consult your tax attorney or certified public accountant when dealing with tax deduction considerations.
  • Could the Federal tax treatment of long term care insurance change?
  • Yes, generally only if the IRS tax code is amended.
  • Are there state tax benefits for purchasing long term care insurance?
  • Yes. Many states offer state tax incentives to encourage the purchase of long term care insurance. If you would like to find out whether your state offers such incentives, please contact your state insurance department directly. You can find the contact information at the National Association of Insurance Commissioners website.
  • Does the Federal Long Term Care Insurance Program (FLTCIP) offer a non-tax qualified plan?
  • No. The law governing the FLTCIP requires the FLTCIP to offer only tax-qualified plans.
  • Can I pay premiums on a pretax basis (premium conversion)?
  • No. Section 125 of the Internal Revenue Code specifically excludes from the definition of qualified benefits, "any product which is advertised, marketed, or offered as long term care insurance."
  • Can I pay premiums through a health savings account (HSA)?
  • Yes. HSAs can be used to pay long term care insurance premiums, subject to limits based on age, which are published by the IRS and are adjusted annually. An HSA is an account established to pay for qualified medical expenses, including qualified long term care costs and long term care insurance premiums. Contributions and withdrawals are tax-free for qualified expenses.

    To open up an HSA you must be covered under a high deductible health plan and meet certain other requirements.

    The Guide to Federal Benefits for Federal Civilian Employees contains more information on HSAs and high-deductible health plans.

    For more information on HSAs, please visit
  • Can I pay premiums through a flexible spending account (FSA)?
  • An FSA is an account established to pay for qualified out-of-pocket health care and dependent care expenses. According to section 125 of the Internal Revenue Code, you cannot use it to pay FLTCIP premiums.


Apply today

Apply Today!

Federal family members can apply for coverage anytime—you do not have to wait for the next open season. Premiums are based on your age and the premium rates in effect at the time we receive your application—the younger you are when you apply, the lower your premium will be.

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