How to Deduct Expenses for Long-Term Care on Your Tax Return
The IRS allows limited deductions for medical expenses and long-term care insurance premiums. See if you qualify.
The need for long-term care can happen at any point in your life, and the costs can be daunting.
According to the U.S. Department of Health and Human Services, more than half (56%) of individuals turning 65 will require some significant need for long-term care during their lifetime. Independent actuarial data from Milliman projects that the average 65-year-old should now prepare to set aside $135,000 to cover these future paid care costs.
While public programs and private insurance may reduce some costs, federal data indicates that more than one-third of families can expect to pay out-of-pocket. About 14% are expected to spend at least $100,000 out-of-pocket. That can be a hard pill to swallow.
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Fortunately, there are ways to recoup some of those expenses.
If you require long-term care, you may be able to deduct some of the costs on your tax return. For those who purchased a long-term care insurance policy to cover costs, you may be able to deduct a portion of your premium payments.
Here’s how to get some of that cash back into your pocket.
Are you eligible for long-term care tax deductions?
When it comes to long-term care costs, you’ll generally have to foot the bill. However, the IRS permits you to deduct some of these out-of-pocket expenses as a medical deduction.
To qualify for this tax benefit, a licensed healthcare professional must deem the long-term care service medically necessary. You can claim these deductions for yourself, your spouse, or a dependent, provided that a licensed healthcare practitioner indicates that the individual meets one of the following criteria:
- The care must be for a chronically ill person, meaning they are unable to perform at least two activities of daily living without substantial assistance from another person for at least 90 days due to loss of some functional capacity.
- Some examples include eating, bathing, or dressing. Also, the condition must be certified within the last year.
- The care is necessary for someone with a severe cognitive impairment, meaning they require substantial supervision to be protected from threats to their health and safety.
Long-term medical expenses you can claim on your tax return
According to the IRS, "qualifying medical expenses" for long-term care can include preventive, therapeutic, treating, mitigating, curing, or rehabilitative services. Expenses for in-home, assisted living, and nursing-home services are also tax-deductible. (See IRS Publication 502 for a full list of qualifying services.)
One interesting point: The cost of admission to medical conferences may be tax-deductible if the conference is related to a chronic illness causing the need for long-term care for yourself, your spouse, or your dependent. However, keep in mind that the cost of meals and lodging while attending the conference isn’t deductible as a medical expense.
How to deduct long-term care expenses
To claim the deduction for long-term care expenses, you must itemize deductions on your tax return on Schedule A (Form 1040).
As mentioned, you can generally claim tax deductions on medical expenses for yourself, your spouse, or a dependent. This can include the cost of care for a parent if they become your dependent.
Here's how it generally breaks down:
- Out-of-pocket tax deductions on long-term care services are just that — an unreimbursed medical expense you had to pay with your personal funds.
- Private Insurance premiums are allowed a limited tax deduction for certain long-term care insurance premiums, which can be included as an itemized deduction for medical expenses.
So how does it work? Deductions for out-of-pocket medical expenses or insurance premiums apply only to expenses not covered by your insurance. Both are deductible to the extent the expenses exceed 7.5% of your adjusted gross income (AGI) for the year.
For example, if your AGI is $80,000, 7.5% is $6,000. Assuming you spent $10,000 in qualifying out-of-pocket long-term care expenses, you may be able to deduct up to $4,000 ($10,000 - $6,000) on Schedule A. (Note: Itemizing only lowers your tax bill if your total itemized deductions exceed your standard deduction.)
2026 maximum deduction limit for long-term care premiums
Long-term care insurance premiums are also subject to an age-related deduction cap. The amount you can deduct also increases the more you age. That's why it's often said that this long-term care tax break improves as you age.
This deduction limit for long-term care is also adjusted to inflation each taxable year.
The deductible limits per individual for taxes generally filed in 2027 (2026 tax year) are as follows:
- Age 40 or under: $500
- Age 41 to 50: $930
- Age 51 to 60: $1,860
- Age 61 to 70: $4,960
- Age 71 and over: $6,200
Are Medicare costs tax deductible?
What you pay in Medicare premiums is also generally deductible from your tax return under certain circumstances, and that will depend on the Medicare program you are in.
Medicare Part A premiums can be deducted from your tax return if you meet the following conditions:
- You voluntarily enrolled in Medicare Part A (because you didn't qualify for premium-free Part A through your work history).
- You aren’t covered under Social Security or receiving railroad retirement benefits.
Medicare Part B, Part C (Medicare Advantage), Part D premiums, and Medigap count as qualified medical insurance expenses. Any total medical expenses, including these premiums, that exceed 7.5% of your AGI for the year can be reported as itemized medical expenses on Schedule A of your federal income tax return.
There is no age-related cap on these Medicare premium deductions, and you can include 100% of your out-of-pocket premium costs toward your medical expense total.
However, keep in mind that while Medicare covers short-term rehabilitation, Medicare does not generally cover ongoing long-term custodial care (like daily help with bathing or dressing). Those expenses typically must be covered out-of-pocket, via long-term care insurance, or through Medicaid.
Self-Employed Filers: You usually don't need to itemize or meet the 7.5% threshold, but you may be able to claim a deduction for Medicare (and long-term care insurance premiums up to the age caps) directly on Schedule 1 (Form 1040).
This tax break gets better as you age, but you can start saving now
With long-term care tax deductions, the maximum amount of your premium that you are allowed to deduct will get better as you age. But until your next birthday — there are some other ways you can cut costs.
One popular strategy is to buy a long-term care insurance policy. Generally, the younger you are, the cheaper your insurance premium will be. You can purchase the policy as a preventive measure; once purchased, traditional policies lock in a level premium based on your age at signup, though the insurance company reserves the right to request rate increases on entire classes of policyholders if claims outpace expectations.
Another way to reduce costs is to share your long-term care insurance policy with your spouse. A joint policy can be cheaper, and allow you in many cases to pool benefits. If one spouse runs out of their benefit, they can use their partner’s share.
If you need more advice about long-term care and saving money on those costs, talk to your financial advisor. They can help you figure out cost-saving measures, or how to properly itemize your expenses ahead of the next tax-filing deadline.
Read More
- Six Tax Breaks That Get Better With Age
- What is Your Adjusted Gross Income (AGI)?
- How To Pay for Long-Term Care
