"Health Insurance Portability & Accountability Act"
The Health Insurance Portability and Accountability Act of 1996.
The Health Insurance Portability & Accountability Act (HIPAA) of 1996 offers
tax incentives to people who purchase tax qualified Long Term Care Insurance.
HIPAA designated two types of long-term care insurance policies: tax-qualified
(TQ) and non-tax qualified policies (NTQ). The tax-qualified policies are the
ones that adhere to HIPAA criteria that standardized long-term care policies
and offer tax incentives.
Long-term care insurance policies that were purchased before January 1, 1997
(when HIPAA was implemented) were grand fathered in and are considered
tax-qualified (TQ) for federal purposes. They will remain tax-qualified if
there are no material changes made to them.
HIPAA also outlined the tax treatment of tax qualified Long Term Care Insurance
In General, if you receive benefits under a tax qualified Long Term Care
Insurance policy, your benefits are excluded from your income the same as
payments your receive for personal injury or sickness.
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