Health · Chapter 17 · Long-Term Care
Tax-Qualified LTC & Taxation
Definition
HIPAA-qualified policies must: pay nothing Medicare reimburses · trigger on 2 of 6 ADLs or severe cognitive impairment · be at least guaranteed renewable · have no cash surrender value · cover only LTC services · give a 30-day free look · require a 90-day disability diagnosis. Rewards: premiums deductible (age-based limits; 100% for the self-employed) and benefits tax-exempt even above actual costs. Non-qualified: premiums never deductible; indemnity benefits above actual expenses are taxable.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms