I was advised by my financial planner that I can still take a medical deduction for long term care premiums even if those premiums are paid via a 1035 (non-taxable) transfer directly from a non-qualified annuity to the long term care insurer that is in the same company as the annuity. There are no 1099s issued for these transactions. IRS Pub 502 seems to state that the payments cannot be used as medical deductions because they were paid with distributions that would otherwise have been included in income. My planner said the difference is that my annuity is not a "retirement annuity" but is listed as a personal account. Any opinion?
