Deductibility of Employer-Paid Premiums
Sole Proprietors who purchase and pay for Tax-Qualified Long-Term Care Insurancepolicies for themselves, their spouses and their tax dependents may claim a deduction for the premiums paid as medical care expenses (IRC Sec. 162(l)(1)(A) and Sec. 213).
Prior to tax year 2003, only a percentage of the eligible Tax-Qualified Long-Term Care Insurancepremiums paid by a self-employed individual were deductible as medical care expenses. However in tax year 2003 and thereafter, the full amount of the Tax-Qualified Long-Term Care Insurance premiums paid by the self-employed individual may be deducted (IRC Sec. 162(l)(1)(B). See the following table for more information.
|Tax Year||Applicable Percentage of TQ LTCI Premium|
Deductible as Self-Employed Health Insurance
Further, as in the case of individual taxpayers, the amount of the Tax-Qualified Long-Term Care Insurance premiums that a self-employed individual may deduct as Self-Employed Health Insurance is subject to the following dollar limits.
|Age attained before the|
end of the taxable year
|Amount allowed as a medical expense in|
|40 or under||$410||$420|
|71 or older||$5,110||$5,200|
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