State Tax Incentives for Long-term Care Insurance

A deduction is allowed for the amount of premiums paid pursuant to a qualifying insurance contract for qualified long-term care coverage. [Code of Ala. 40-18-15(27)(1996)]

Adopts section 213 of Internal Revenue Code for computing medical and dental expense deduction under state income tax law. [Ark. Code Sec. 26-51-423 Reg. 1.26-51-423(a)(2)]

A deduction is allowed to the extent provided in the federal Internal Revenue Code. [Cal. Rev. & Tax Code ' 17201 (1996)]

A credit is allowed in taxable years on or after January 1, 2000 for 25 percent of premiums paid for long-term care insurance or $150.00 per policy. The credit will be available to only individual tax payers with taxable income of less than $50,000 or two individuals filing a joint return with a taxable income of less than $100,000. [C.R.S. 39-22-122 (1999)]

Effective 1/21/05, permits a deduction from gross income the amount an individual pays annually in long-term care premiums, provided that the deduction shall not exceed $500.00 per year, per individual, whether the individual files individually or jointly. [section 47-1803.03 (b-1) of the DC Official Code]

For tax years beginning on or after 1/1/99, an individual state tax deduction is allowed for long-term care insurance premiums. A deduction is allowed for premiums paid for long-term care insurance to the extent such premiums are deductible in determining federal taxable income beginning in taxable years after December 31,1998 and is also only available to the extent that all medical expenses, including Long-Term Care exceed 7.5% of Hawaii Adjusted Gross Income. [HRS sec 235-2.3, (1999)]

A deduction is allowed for taxable years beginning on or after January 1, 2004 for the premiums for long-term care insurance as defined in section 41-4603 Idaho Code. For tax years beginning on or after January 1, 2004, allows an individual taxpayer to deduct the full amount of premiums paid for long-term care insurance for the taxpayer, a dependent or an employee. The deduction may be taken for a federally tax-qualified long-term care insurance policy meeting Idaho's definition of long-term care insurance. (prior law allowed for a taxpayer to deduct 50 percent of the costs for premiums, effective 1/1/2004, the limitation is removed, and the full amount of the premium may be deducted.) [Chapter 30, Title 63, Sec. 63-3022Q(2004) Reg. 41-4603]

For tax years beginning on or after January 1, 2000, an individual taxpayer is permitted to deduct an amount equal to the eligible portion of premiums paid during the taxable year by the taxpayer for a qualified long-term care policy (as defined in the Indiana Code, for the taxpayer, the taxpayer's spouse, or both FOR QUALIFIED PARTNERSHIP POLICIES ONLY. [Ind. Code Secs. 6-3-1-3.5]

A deduction is allowed for tax years beginning on or after January 1, 1997, for premiums for long-term care insurance for nursing home coverage to the extent the premiums for long-term health care services are eligible for the federal itemized deduction for medical or dental expenses. Adopts section 213 of Internal Revenue Code for computing medical and dental expense under state income tax law. [IAC Chapter 40, ' 701-40.49(422); IAC ' 422.7(1997)]

A deduction for tax years beginning after 12/31/04 is allowed up to $500 of qualified LTC premium costs. The deduction increases by $100 each year to a maximum of $1,000. (K.S.A. 2000 supp. 79-32 117(c)(xvi)2004)

Exclusion For tax years beginning on or after January 1, 1999, a taxpayer may exclude from Kentucky Adjusted Gross Income any amounts paid for long-term care insurance as defined in the Kentucky code. [Ky. Rev. Stats. Sec. 141.010(10)(m) Reg. 304.14-600 & 610]

A deduction is allowed for an amount equal to the total premium spent for insurance policies for long-term care that have been certified by the Superintendent of Insurance as complying with Title 24-A, Chapter 68. For tax years beginning on or after 1/1/04, a taxpayer may tax a state income tax deduction an amount equal to the total premiums spent for LTC insurance, as long as the amount subtracted is reduced by any amount claimed as a deduction for federal income tax purposes. [36 Me. Rev. Stat. Sec. 5122] Amended 5/11/04 [Title 36, Part 8, Chapter 805, Sec. 5122 (1989)]

For employers, a credit is allowed against the tax imposed for each taxable year equal to the lowest of the following: (A) $5,000; (B) 20% of the costs incurred by the taxpayer in providing long-term care policy coverage as part of the benefit package; or, (C) $100 for each employee covered by an employer provided long-term care policy. [Title 36, Part 4, Section 2525, Chapter 357 (1996)]

A credit is allowed against the state income tax for employers providing long-term care insurance up to an amount equal to 5 percent of the costs incurred by the employer during the taxable year for providing long-term care insurance as part of the employee benefit package. The credit may not exceed $5,000 or $100 for each employee covered by long-term care insurance under the employer benefit package and it is applicable to all taxable years beginning after 12/31/98. [Ins. Art. 6-117, Chapter 7 (1998) Md. Tax Code Sec. 10-710]

For tax years beginning on or after January 1, 1999 a credit is allowed for long-term care insurance premiums during the taxable year equal to (1) 25% of premiums paid to the extent not deducted in determining federal taxable income; or, (2) $100. Maximum allowable credit per year is $200 for couples filing jointly and $100 for all other filers. [Sec. 21, Sec. 290.0672 subdivision 2 (2000)]

As of January 1, 2007, a taxpayer is allowed a credit against the income taxes imposed under this chapter in an amount equal to 25% of the premium costs paid during the taxable year for a qualified long-term care insurance policy as defined in Section 7702B of the Internal Revenue Code that offers coverage to either the individual, the individual's spouse, the individual's parent or parent-in-law, or the individual's dependent as defined in Section 152 of the Internal Revenue Code. No taxpayer is entitled to the credit with respect to the same expended amounts for qualified long-term care insurance which are claimed by another taxpayer. The credit allowed by this section shall not exceed $500 or the taxpayer's income tax liability, whichever is less, for each qualified long-term care insurance policy. Any unused tax credit shall not be allowed to be carried forward to apply to the taxpayer's succeeding year's tax liability. No credit shall be allowed under this section with respect to any premium for qualified long0term care insurance either deducted or subtracted by the taxpayer in arriving at his net taxable income under this section or with respect to any premiums for qualified long-term care insurance which were excluded from his net taxable income.

Beginning January 1, 2007, this bill authorizes 100% of the amount paid for non reimbursed qualified long-term care insurance premiums to be deducted from a taxpayer's Missouri taxable income to the extent the amount is not already included in the taxpayer's itemized deductions. SB 577 (SECTION 135.096] Formerly, a deduction was allowed for a resident from state taxable income for an amount equal to fifty percent of all non reimbursed amounts paid by an individual for qualified long-term care insurance premiums to the extent such amounts are not included in the individual's itemized deductions for all taxable years beginning after December 31, 1999. [Section 8 of R.S. MO 334660 (1999)] [Mo. Rev Sat. SEc. 135.096] Secs. 376.951-376.958 of Missouri Long-Term Care Insurance Act.]

Participants may deduct up to $1,000 ($2,000 filing jointly) from their federal adjusted gross income for Nebraska state income tax purposes by depositing an equal amount into a designated Long-Term Care Savings Plan account at a participating financial institution. (LB 965 - 1/1/06) LB 305 approved may 30, 2007 for anyone turning 50 in 2007, benefits Nebraskans by strengthening Nebraska's Long Term Care Savings Plan by 1) Allowing a participant to pay a long-term care insurance policy premium for another person for whom the taxpayer has an insurable interest; 2) Allowing a person who turned 50 during the taxable year to make payments for long-term care insurance premiums during the taxable year. (These Legislative Bills amend Section 77-6102 of Nebraska State Law).

Allows a deduction for medical expenses (including long-term care insurance premiums), only to the extent such expenses exceed 2% of taxpayer's gross income. [N.J. Stat. Sec. 54A:3-3]

Permits deduction for premium paid for qualified long-term care insurance contract defined in Internal Revenue Code section 7702(B), as part of unreimbursed or uncompensated medical care expenses. Total medical expense deduction is limited, based on income level. [N.M. Stat. Ann. sec. 7-2-35]

A credit is allowed equal to 20% of the premium paid during the taxable year for long-term care insurance approved by the Superintendent of Insurance provided policy qualifies for such credit pursuant to Section 1117. If the amount of credit allowable under this subsection for any taxable year shall exceed the taxpayer's tax for such year, the excess may be carried over to the following year or years and may be deducted from the taxpayer's tax fro such year or years and applies to taxable years beginning on or after January 1, 2004. [Sec. 210, subdivision 25-0-1 Chapter 58 (2004)] [NY Tax Law SEc. 606(aa)]

A credit is allowed to be applied against an individual's tax liability in the amount of 25% of any premiums paid by the taxpayer for long-term care insurance coverage for the taxpayer or the taxpayer's spouse, parent, step-parent or child. The credit may not exceed $100 in any taxable year. [Title 57, Chapter 57-38 (1997)]

A deduction is allowed for individual policy premiums paid for qualified long-term care insurance effective for taxable years beginning January 1, 1999. Generally allows a deduction for the amount paid for qualified long-term care insurance for the taxpayer, his spouse, and dependents [OH REV. STAT. Section 5747.01 (1999)]

A deduction is allowed from federal taxable income of a resident or nonresident individual for tax years beginning on or after January 1, 2000, of any amounts paid for premiums on long-term care insurance policies to the extent the amounts paid were not deducted under Section 213 of the Internal Revenue Code in determining federal taxable income. This deduction is for all premiums paid for long-term care insurance as defined under the Utah Code. [Chapter 60, ' 59-10-114(1999)][Utah Code Sec. 59-10-114(2)(K) Sec. 31A-1-301]

If the tax-qualified policy was purchased after January 1, 2006, an individual may be eligible for a tax credit equal to 15% of the total premiums paid in the year for the first 12 months of coverage. Certain limitations apply. Other credits maybe available for previously purchased policies.