On Behalf of a Partner
A Partnership that purchases Tax-Qualified
Long-Term Care Insurance on behalf of a Partner may deduct the
premiums paid as an ordinary business expense. This holds true for Tax-Qualified Long-Term Care Insurance purchased
for the Partner's spouse or other tax dependent.
On Behalf of an Employee
A Partnership that purchases Tax-Qualified
Long-Term Care Insurance on behalf of an Employee may deduct
the premiums paid as an ordinary business expense. This holds true for Tax-Qualified Long-Term Care Insurance purchased
for the Employee's spouse or other tax dependent.
Tax Consequences of Partnership-Paid Premiums
For the Employee
Employer-paid Long-Term Care
Insurance premiums would not be included in the Employee's
gross income (IRC Sec. 106)
For a Partner
The entire amount of the Tax-Qualified
Long-Term Care Insurance premiums paid by the Partnership is
includable in the partner's gross income. The same holds true for partnership-paid
Tax-Qualified Long-Term Care Insurance
premiums paid on behalf of the Partner's spouse or other tax
dependents.
In this case, the partner is treated as a self-employed individual for tax
purposes and the Tax-Qualified
Long-Term Care Insurance premiums received would be subject to
the same tax rules as apply to Sole Proprietors.