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The Federal and New York State Tax Advantages of Long Term Care Insurance

If you have looked into purchasing long term care insurance, you know that it is an expensive proposition. However, there are some tax advantages related to the premium payments for long term care insurance.

If you are an employee and itemize your deductions, you can deduct a portion of your long term care insurance premium as a medical expense on the itemized deductions of Schedule A of your 1040 tax return.

Premiums for qualifying long term care insurance policies for individuals under 65 may be deducted to the extent that they, along with other non-reimbursable medical expenses, exceed 10 percent of the individual’s adjusted gross income.

The maximum deductions for 2017 for long term care insurance premiums paid (these amounts increase annually) are as follows:

If you are self-employed, you may be able to deduct premiums that you pay for medical, dental and qualifying long term care insurance premiums for yourself, your spouse and your dependents. This is a deduction on page 1 of Form 1040 and is not an itemized deduction subject to the percentage of adjusted gross income limitations as a medical expense under itemized deductions.

Partners and LLC members who are treated as partners for tax purposes may also be able to deduct health and long term care insurance premiums as a straight deduction and not limited as an itemized deduction as a medical expense under certain circumstances.

Additionally, if you are a New York State resident you are entitled to a credit on your New York State tax return if you or your business pay premiums for qualifying long term care insurance policies. The credit is 20 percent of the premiums.

Therefore, while long term care insurance appears to be quite expensive, if you are unlucky enough to get sick and be in need of long term care, long term care insurance definitely softens the blow on protecting your assets and income, and there are deductions and credits available to reduce the actual cost of the long term care insurance.

Federal And New York State Tax Advantages Of Long Term Care Insurance

If you have looked into purchasing long term care insurance, you know that it is an expensive proposition. However, there are some tax advantages related to the premium payments for long term care insurance.

If you are an employee and itemize your deductions you can deduct a portion of your long term care insurance premium as a medical expense on Schedule A of your 1040, itemized deductions.

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Social Security, Medicaid Income And Resource Levels And The Regional Rates For Calculating A Penalty Period For 2016

The Social Security and Supplemental Security Income (SSI) benefits did not increase for 2016, and remain the same as in 2015.

There is also no increase in the spousal impoverishment standards for 2016.  The community spouse Minimum Monthly Maintenance Needs Allowance (MMMNA) remains at $2,980.50.  This is the amount of monthly income a spouse who is in the community, whose spouse is institutionalized, may keep.

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Sweeping Changes to Claiming Social Security Benefits

The budget bill signed on November 2, 2015 by President Obama included sweeping changes in the claiming of Social Security benefits. The changes ended two major Social Security claiming strategies for married couples.

No more file and suspend or restricted application.

If you have not filed for social security benefits within 180 days of the bill’s passage on November 2, 2015 you will no longer be able to use the program’s “file and suspend” rule. This claiming strategy has permitted one member of a married couple to file for Social Security, thereby enabling a husband or wife to file for a spousal benefit. The spouse, meanwhile, could suspend his or her own retirement benefit, which then could grow due to delayed retirement credits by 8% a year.

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What are my Duties as Agent on a Power of Attorney?

Your mom has appointed you as her agent on her power of attorney. Now what?

All powers of attorney signed on or after September 12, 2010, must be signed by the agent (you), acknowledging your appointment in order for you to act. The power of attorney document informs the agent (you) of your legal responsibilities: to act according to the principal’s instructions, or where there are no instructions, in the principal’s best interest; avoid conflicts that would impair your ability to act in the principal’s best interest; and keep records of your transactions as agent.

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Social Security Retirement Planning If You Are Divorced

If you are divorced, you are entitled to receive benefits on your ex-spouse’s record (even if he or she has remarried) if:

1. Your ex-spouse is entitled to Social Security benefits. If your ex-spouse worked for ten years or more, then he or she is eligible to receive retirement benefits as early as age 62. Also, if your ex-spouse is receiving Social Security Disability benefits, you may qualify for benefits; and

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Protecting your Home from the Catastrophic Cost of Long Term Care

The average cost of a nursing home stay in the Central New York region is over $100,000 per year.  Many people want to make sure their home is protected if they ever need to be placed in a nursing home.

The home is protected if there is a surviving spouse or a disabled child living there, but with limited exceptions, if, for example, one spouse dies and the surviving spouse has to enter a nursing home, the house must be sold to pay for the nursing home before the individual can avail him or herself of Medicaid.

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Is your family taking advantage of the New York State Nursing Home Assessment Credit?

New York Public Health Law §2807-d(2)(b) imposes an assessment on New York residential health care facilities of six percent (6%) of the receipts of the residential health care facility. In most cases, the nursing homes pass on this assessment to the residents. This assessment is shown as a separate line item on the nursing home monthly bill.

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Trust Planning and its Interplay with Asset Protection – An Overview

Asset protection planning is the development of legal planning techniques to place the client’s assets beyond the reach of future (not present or known) creditors.

Many individuals have the potential for future creditor problems, whether it be through divorce, malpractice claims, tax liens, business claims, long term care expenses or other catastrophic expenses. Therefore, it would be prudent for individuals to discuss asset protection with an attorney who specializes in this area of the law.

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