Form 1099-LTC: Long-Term Care and Accelerated Death Benefits
Report payments made under long-term care insurance contracts and accelerated death benefits.
Filing Deadline
January 31 (to recipient) / February 28 (paper) or March 31 (e-file) to IRS
Who Files
Insurance companies, viatical settlement providers
Purpose
Reports benefits that may be partially or fully taxable
Overview
Form 1099-LTC is used to report payments made under long-term care insurance contracts and accelerated death benefits from life insurance policies. This includes benefits paid to chronically ill or terminally ill individuals.
Long-term care benefits and accelerated death benefits are generally excludable from income, but there are limits and exceptions that require reporting.
Who Must File
Required Filers
- •Insurance companies that pay long-term care benefits
- •Viatical settlement providers who pay accelerated death benefits
- •Any payer of benefits under a life insurance contract for a terminally or chronically ill individual
- •Must file regardless of the amount paid
Form Structure & Instructions
Here's what information is required in each section:
Long-Term Care Benefits
Payments under long-term care insurance
Policyholder and Insured Information
Details about the insured individual
Important Filing Notes
Qualified vs. Non-Qualified
Benefits from qualified long-term care contracts are generally tax-free, subject to certain limits. Non-qualified contracts may result in taxable benefits.
Per Diem Limits
For per diem contracts in 2024, benefits over $420/day may be taxable unless actual expenses exceed this amount. The limit is indexed annually.
Terminally Ill Exception
Accelerated death benefits paid to terminally ill individuals are generally fully excludable from income without dollar limits.
Chronically Ill Requirements
To be chronically ill, individual must be certified as unable to perform at least 2 activities of daily living for 90+ days, or require substantial supervision due to cognitive impairment.
Specialized Long-Term Care Reporting
Navigate the complex rules for long-term care and accelerated death benefit reporting with expert guidance and accurate Form 1099-LTC filing.
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