Entered this once already, then it disappeared, then it showed up, then it disappeared again, ???
I have a OneAmerica LTC policy that I purchased a couple of years ago by doing a trustee-to-trustee transfer from my IRA, so no taxable event. Then each year for 10 years they will transfer $36,000 to pay for the LTC policy which causes me a taxable event but doesn't withdraw anything from my current funds. How can I enter in the taxable event for each year without having it do an erroneous drawdown from one of my accounts?
Thanks.
@brentww73 I think you could set up an Other Income stream of $36,000 per year, taxable as ordinary income, and a corresponding Miscellaneous expense to consume that income. The income and the expense would result in a net zero cash flow EXCEPT FOR the taxes, which would increase your expenses in those years.
Stuart
@brentww73 In addition to what Stuart said, be careful about taxation. I seem to recall some issue with some LTC riders on annuities not having the same tax benefits of paying for LTC out of pocket or through regular LTC insurance. That could be a big hit, as it's usually a nice deduction late in life. Make sure you know if you quality for the tax break if you can itemize that big expense, and make sure if you don't, that Pralana isn't assuming you're getting it. Could be because the annuity company is making the payments directly to the provider? I don't remember. Also pay attention to everything in that policy. The delay periods are getting longer, i.e the length of time you must be in LTC first before they begin paying their share. I've seen where people expire during that period and get no help whatsoever.
