Some individuals can write off LTC premiums if they exceed 10 percent of their adjusted gross income because premiums are considered medical expenses. If you are a W2-earning household with $200,000 adjusted gross income, you have to top $20,000 in medical expenses just to begin to write off some of your premiums. This is not a very good tax break.
Business owners and the self-employed, however, have an incredible tax strategy that can make LTC insurance really affordable. We recently ran a quote for LTC insurance for a couple in their 50s that was going to cost $3,450 per year. If they owned their own business, they could write off $3,060 of their premium based on the 2017 limits below.
If this couple is in the 28 percent tax bracket, their policy only costs them $2,593.20 per year instead of $3,450 (3,060 x .28 = 856.80). As they get older, they can deduct even more.