2021 Updates on Long-Term Care Insurance Tax Deductions, Medicare, Medicaid & Health Savings Account Deductibles

2021 Updates
Provided by: GotLTCi

HIPAA:

Attained age before the close of the taxable year: Amount that counts as a medical expense OR paid through a Health Savings Account OR 1st dollar tax-deduction for self-employed
40 or less $450
41 – 50 $850
51 – 60 $1,690
61 – 70 $4,520
71 and older $5,640

Indemnity/cash policies: Benefit payments above $400 per day that exceed the actual cost of care will be taxed as income. [IRS §213(d)(10)]

Self-Employed Long-Term Care Insurance Deductions:
100% of age-based limits for owner and spouse. C-Corps 100% of premium.

Medicare: 

Part A Deductible
$1,484
Skilled Nursing Facility Coinsurance $185.50
Part B Deductible $203
Part B Premium $148.50 (incomes below $88,000 individual / $176,000 joint)
Qualified Medicare Beneficiary*
(Annual amounts are issued in approximately February each year)
Individual: $1,084 monthly income / $7,860 assets
Couple: $1,457 monthly income / $11,800 assets

Medicaid: Click here to see state-specific Medicaid information

Spouse’s minimum asset allowance $26,076
Spouse’s maximum asset allowance $130,380
Spouse’s minimum income allowance* $2,155 (effective 7/1/20 – 6/30/21)
Excess shelter allowance $646.50 (effective 7/1/20 – 6/30/21)
Spouse’s maximum income allowance $3,259.50
Income cap states (3 x SSI) $2,382
Home equity limits $603,000 / $906,000

Health Savings Accounts:
(Minimum Deductible: $1,400 Individual / $2,800 Family)

Individual = Maximum contribution of $3,600. Additional 2021 contribution of $1,000 for 55+; Out-of-Pocket maximum: $7,000. Family = Maximum contribution of $7,200. Additional 2021 contribution of $1,000 for 55+; Out-of-Pocket maximum: $14,000.

*Limits vary for AK and HI

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