I have a long term care insurance policy that was issued prior to the Health Insurance Portability and Accountability Act...

I have a long term care insurance policy that was issued prior to the Health Insurance Portability and Accountability Act (HIPAA). What is the tax treatment and can I make changes to the policy.

Under HIPAA, all long term care insurance policies issued before January 1, 1997 were grandfathered, and automatically receive favorable tax treatment. However, under IRS regulations, a change to a grandfathered LTC insurance policy may jeopardize its tax-qualified status. Before making a change to any grandfathered LTC insurance policy, you should consult your tax advisor and assess the impact of the change on the tax-qualified status of the policy.

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