1099-LTC Box 3 - Reimbursed Amount checked - husband has one and wife has one

[duanecpa]

Husband and wife are in a LTC facility - their LTC insurance provider provided 1 1099-LTC form for each of them - they file Married Filing Joint - According to Page 6 of Form 8853 instructions - FILING REQUIREMENTS FOR SECTION C - Following the -Start Here - Did you or your spouse (if filing jointly) receive payments in 2014 made on a per diem basis or other periodic basis under a LTC insurance contract? Answer is NO since the Reimbursed Amount is checked - also next box - is not accelerated death benefits - answer is NO - concludes with DO NOT COMPLETE SECTION C.

Question - if the 1099-LTC information is not reported in Section C on IRS Form 8853 on the individual's tax return, is it reported on the individual's tax return anywhere? If so, where is the information on the 1099-LTC reported on the individual's income tax return?

Thank you.

[kathyc2]

Not sure what you think you need to report? Reimbursed method with no accelerated death benefits is simply making the client whole for actual expenses.

[duanecpa]

Not sure what you think you need to report? Reimbursed method with no accelerated death benefits is simply making the client whole for actual expenses.

Notice from IRS says that the amounts reported on the 1099-LTC is missing from the tax return - thus in this situation, just the explanation along with copies of the 1099-LTC should satisfy the IRS - correct?

[FEDUKE404]

Dealing with Form 8853

Notice from IRS says that the amounts reported on the 1099-LTC is missing from the tax return - thus in this situation, just the explanation along with copies of the 1099-LTC should satisfy the IRS - correct?

It's been a couple of years since I have dealt with a Form 1099-LTC.

Having said that, I seem to recall it IS necessary to work through a Form 8853, especially page two of same. (You may even need to complete a "his" and a "hers" ??)

Suggest you use the Q&A option of your tax software and carefully answer all of the questions posed.

FE

[kathyc2]

Notice from IRS says that the amounts reported on the 1099-LTC is missing from the tax return - thus in this situation, just the explanation along with copies of the 1099-LTC should satisfy the IRS - correct?

The IRS would have a copy of the 1099, so a little surprised that they would have received a notice if the reimbursed box was checked. Unless the notice indicated something different, your idea sounds reasonable.

[Burke]

According to Page 6 of Form 8853 instructions - FILING REQUIREMENTS FOR SECTION C - Following the -Start Here - Did you or your spouse (if filing jointly) receive payments in 2014 made on a per diem basis or other periodic basis under a LTC insurance contract? Answer is NO since the Reimbursed Amount is checked -
Thank you.

Shouldn't the answer be "Yes?" There is no instruction about answering this question NO if the Reimbursement Amount box is checked. The Per Diem and Reimbursement boxes simply refer to whether they were paid a flat daily amount or actual expenses based on documentation submitted. Moving to next question on the chart on Page 6, answer would be Yes again, and then you are instructed to Complete all of Section C. Question #1 means -- were benefits paid under the contract for the person who is insured, not whether they were personally received by the insured or whether they were paid directly to the LTC facility. There is a box to check at the top of Form 8853 to advise if the form is being completed for another person. You would check Yes, and do another one for the spouse. The intent is to determine if excess benefits were received over the IRC limits.

[FEDUKE404]

Completing Form 8853

Shouldn't the answer be "Yes?" There is no instruction about answering this question NO if the Reimbursement Amount box is checked. Moving to next question, answer would be Yes again, and then you are instructed to Complete all of Section C. I interpret this to mean benefits were paid under the contract for whom the person is insured, not whether they were personally received by the insured or whether they were paid directly to the LTC facility. There is a box to check at the top to advise if the form is being completed for another person. You would check Yes, and do another one for the spouse. The intent is to determine if excess benefits were received under the IRC limits.

Thanks, Burke.

Your detailed comments pretty well solidify the process I recall using several times in the past.

In spite of some of the comments here, I've always viewed receipt of a Form 1099-LTC as one of those "prove your innocence" scenarios. Line 21 of Form 1040 always lurks.

( Getting to page 2 of Form 8853 and/or the Q&A for same can sometimes present a bit of a tax software challenge. )

The flowchart on page 6 of the IRS instructions for Form 8853 might also be a bit helpful. . . https://www.irs.gov/pub/irs-pdf/i8853.pdf

FE