Probably not. The general rule is that benefit payments received under a qualified LTC policy are tax-free. A qualified policy must be guaranteed renewable, and can’t have a cash value. Most LTC policies sold these days are qualified policies. To be sure, you can refer to your policy or contact your insurer.
Some qualified policies pay a fixed daily benefit, regardless of actual costs. For 2023, benefits paid under such a per-diem policy are automatically tax-free up to $420 per day. If benefit payments exceed the cap, they’re still tax-free if actual costs for qualified LTC services equal or exceed the payments. If your case, if the amount received was for the entire year, it is not taxable.
You should have received a Form 1099-LTC. To enter your Form 1099-LTC, see the following TurboTax Help Article: Where do I enter Form 1099-LTC?
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