How business owners benefit from tax
deductions for long term care insurance.

Owning your own business has its advantages with tax deductions and write offs but one benefit has to do with securing your financial assets in the event you need long term care in the form of a nursing home or a home care provider.

About half of all Americans will eventually need ling term care. Generally those is mid life will pay about $200 - $300 a month for a good long term care insurance policy but lets take a look at what that policy would cost you if you own your a business.

Long Term Care business owner deductions vs W2 employee deductions
If your long term care premiums are more than 10% of your adjusted gross income you can write off a portion of the premium because it is considered a medical expense. But this isn’t a great tax incentive because for a couple that makes $150,000 a year, they would have to incur $15,000 in medical expenses every year to have that tax incentive kick in.

But if you are a business owner the tax incentives are much better. Once example is a couple who owns a marble and flooring company that came to Blue Sky Insurance seeking advice on a long term care policy. They were 54 years and their annual premium was $3,645, but with the tax incentives for business owners their premium ended up costing them only $435 a year. That is a huge savings that many business owners are not aware of.

The same couple, if they were an employee in the 28% tax bracket would still save money but only a fraction of that amount. But as they grow older, the limitations on the premiums would increase. Limitations on premiums for those who are not self employed are: (40 - 50) - $770, (50 - 60) - $1,530, (60 - 70) - $4,090, and (over 70 years old - $5,110.

Depending on what type of corporation you have, C Corp, S Corp, Sole Proprietorship, or a partnership, you can reap the rewards of the corporate tax credits. The way you file and submit to the IRS is different. For example, a sole proprietor debuts insurance premiums as self employed health expenses on Form 1040. Partnerships deduct premiums as guaranteed payments and added back to the income.

Employee benefits
Long Term Care insurance premiums are not added to your employees income and also is tax deductible to you as the business owner. The amount depends on whether you are an employee of your own company or not.
Offering Florida Group Benefits insurance to your employees has many advantages, but a long term care insurance policy can protect assets and secure your employees financial future.