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Get your taxes done using TurboTax
Yes, you would enter your one-time buy-out of your long term care policy as miscellaneous income. It would normally be reported on a Form 1099-MISC.
You would list a 1099-MISC from a Long Term Care Policy as taxable income if you paid the premium with pre-tax monies.
If your insurance premiums were paid with after-tax monies, then the lump sum would not be taxable because they are considered a form of health/disability insurance.
To enter "Other Miscellaneous Income" in TurboTax you can follow the instructions below.
You can enter "Other Miscellaneous Income" as follows using TurboTax Online:
- Go to the "Wages & Income" section of TurboTax
- Select "I'll Choose What to Work On"
- Scroll down to "Less Common Income"
- Select "Start or Update" next to Miscellaneous Income"
- Scroll down to "Other Reportable Income "
- Select "Start or Update"
- Enter your income on the page that says "Other Taxable Income"
- Select "Continue"
- Answer all of the follow-up screens.
You can do this as follows using TurboTax Online:
- Click on "Pick up where you left off"
- Click on "Wages & Income" in the left panel
- Click on "Less Common Income"
- Scroll down to "Miscellaneous Income"
- Scroll Down to "Other Reportable Income"
- Click on "Start"
- Follow the screens and answer all follow-up questions
Click here for Publication 525 (2024), Taxable and Nontaxable Income
Click here for additional information on Schedule 1.
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