P&C Agency Owners Get an LTCi Plan and a Tax Deduction

Join us for this free educational webinar where we will discuss online marketing and remote sales. You can register with the link here.

“Information is liberating.” – Kofi Annan

Welcome to The Insurance Experts, your weekly spot for planning stories and strategies that matter to you and your clients.

Click Subscribe above to be notified of each free edition.

Also, subscribe to Financial Planning Innovation and Inside the Mind of an Actuary where more experts share their stories.

“Well, I knew he owned his own agency, so I knew there was tax deductibility there. So, I said, may I ask you how your business is structured? Is it an S-Corp or is it an LLC? He said, no, we are actually a C-Corp. I tried not to show my excitement while talking to them because we know that C-Corps can participate heavily in the tax deduction [on long term care insurance premiums.]” – Angie Hughes

On today’s episode of The Insurance Experts, I interview long term care insurance expert, Angie Hughes. Unlike most people, she actually hasn’t had a personal experience in her family with needing long term care. However, time and again she has seen the value that these policies have brought to her clients.

Angie is the managing partner of a brokerage general agency that helps other agents find solutions for their clients. She works with many P&C agencies and the long term care case she discusses in this video was a plan for the agency owners themselves.

The agency owner’s parents had a long term care insurance policy and utilized the benefits, so the clients were already advocates for the coverage. They were surprised to find out that as a C-Corporation, they were able to deduct all of the premiums from their traditional LTCi as a write-off from their income taxes. As an added advantage, the LTC insurance benefits when received would still be tax-free even after taking the deduction.

Although they were interested in and explored life insurance with LTC riders (which may offer a tax deduction on the LTC rider portion of the premium), the traditional solution proved to be the best fit in this case.

It is worth noting that virtually all profitable business owners including sole-proprietors, LLCs, and S-Corps are eligible for the tax deduction. The business structure and policy design generally determine the amount of the tax deduction available in a particular client situation. This is why it is important to work with an LTC specialist and consult with your client’s tax advisor before recommending solutions.

Join The Community of LTC Planning Experts at www.BuddyIns.com

BuddyIns is a community of long term care insurance specialists. We are dedicated to helping families across the country with customized LTC planning solutions.

Close Menu