8. Does Maryland offer a tax break for long-term care insurance?
If you purchase a long-term care insurance contract for yourself or certain members of your family, you may be eligible for a one-time credit of up to $500 for each insured. To qualify for the credit, the insured must be all of the following:
- A spouse, parent, stepparent, child or stepchild.
- A Maryland resident;
- Not covered by long-term care insurance before July 1, 2000.
- Not have the credit for the insured being claimed by another taxpayer.
- Not have the credit claimed by anyone in any other tax year.
For tax year 2017, you can claim a credit equal to the premiums paid, up to a maximum of $410 for each insured person 40 years of age or younger, and up to a maximum of $500 for each insured person over the age of 40.
This tax credit must not have been claimed for the insured by another taxpayer in this year or anyone else in any other tax year. If the credit exceeds the tax liability, the unused credit may not be carried forward to any other tax year.
Claiming the credit
To claim the credit, you must file Maryland Form 502, 505 or 515. Complete Part E of Form 502CR and include Form 502CR with your return.