Potential Tax Benefits of Lifecare at New Pond Village
The upfront costs and monthly fees of retirement communities don’t have to be daunting. There are special tax benefits for Type A continuing care retirement community (CCRC) residents that may significantly reduce the costs.
Some Ways You May Save
While you should always consult a tax and estate planning professional while planning for your retirement years, here are some of the tax benefits that may be available to you when you choose the Lifecare plan at New Pond Village:
- You may be eligible to deduct the non-refundable part of your entry fee as a pre-paid medical expense. If you choose our Lifecare plan with the 90% refund option, you can deduct the remaining 10% as a medical fee on your income taxes.
- The additional entry fee for a spouse or partner, which is non-refundable, may also be deductible.
- A portion of your service fees (traditionally 20% to 25%) are deductible as medical expenses. For example, if your service fees total $100,000 per year, you may be able to deduct up to $45,000 on your taxes. The taxes you save can mitigate the cost of moving to a senior living community.
- If you transition to Assisted Living, you may be able to take a higher deduction, depending on the actual medical care you receive during the year.
The bottom line: Lifecare can keep more money in your pocket, making retirement living more affordable than you imagined!
Other Financial Benefits of a Type A CCRC
The unique structure of a Type A CCRC can allow for these tax benefits while also giving you better predictability of expenses for the rest of your life. Almost all residential services, amenities, and if needed, health-related services are provided with little or no increase in monthly fees, other than inflationary adjustments.
You will know ahead of time what your future care will cost without worrying about rising healthcare costs, eligibility or illness. Even if there is a financial setback, we will work with you and your loved ones to find an appropriate payment plan.
It is important to explore Lifecare benefits while you are still healthy and independent because you must be in adequate physical health to qualify. Waiting until there is a health crisis will limit your choices in retirement living and disqualify you for Lifecare’s benefits.
When Partners’ Needs Differ
Another important benefit of Lifecare is a couple’s guaranteed continuum of care. Even when one partner’s needs differ, they still only pay one monthly fee.
For example, if one spouse needs the increased care available in Assisted Living and the other does not, they can continue to live at New Pond Village in different neighborhoods. Both will receive the appropriate care and continue to enjoy life together in our community.
What About Long-Term Care Insurance?
Many long-term care insurance policies can be used to help cover monthly service fees in Assisted Living and Skilled Nursing.
However, maximum deduction levels depend on a resident’s age. It is important to look at the cost, type of policy and available benefits, then weigh them against potential tax savings before deciding whether to keep a long-term care insurance policy.
Want to Learn More? Contact Us!
Of course, potential tax benefits and the security of Lifecare are not the only reasons to move to a Type A CCRC like New Pond Village. Premier services and amenities, like-minded neighbors, a wide range of engaging programs and learning opportunities, and the freedom to do what you want are all features of life in our amazing community. That’s why our residents are proud to say they Live in New Pond Village!