We recently updated our Agent Tax Guide again to include important new information producers should be aware of.
On the Additional Tax Considerations page—just below the Cafeteria Plan section—we’ve added guidance on Qualified Long-Term Care Insurance Distributions. This update explains how participants in certain employer-sponsored retirement plans and IRAs may be able to take penalty-free distributions to pay premiums for qualifying long-term care insurance policies under IRC §7702B.
The new section outlines:
- Which retirement plans may allow this option
- How the 10% early-withdrawal penalty may be waived before age 59½
- Annual limits on eligible distributions
- Key tax treatment considerations, including Roth accounts
- Important plan-specific limitation
We encourage all producers to review the updated guide to ensure they’re aware of this provision and how it may apply to their clients’ planning conversations.
Agent Tax Guide Update: New Long-Term Care Insurance Information Added
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