Official Nebraska Government Website
  Home   -  About Us  -  Contact Us  -  Jobs  -  Languages - Site Map  -  SEARCH: >>
Nebraska Department of Revenue   Property Assessment DivisionMotor Fuels DivisionCharitable Gaming DivisionNebraska Lottery
Property Assessment DivisionMotor Fuels DivisionCharitable Gaming DivisionNebraska Lottery
Subscribe!
   Online Services
   Tax Incentives
   Forms
   FAQs
   Information Guides
   Legal Information
   News Releases/FYI
   Research Reports
   Sales Tax Rate Finder
   Tax Calendar
   Taxpayer Education
   Useful Links

Nebraska Long-Term Care
Savings Plan Contribution

Revised December 31, 2008


A Long-Term Care Savings Plan is a deposit account established by a participant with a participating Nebraska financial institution, to be used for qualified long-term care expenses or to pay long-term care insurance premiums for certain qualified individuals.

A “participant” means any individual who has contributed to a Nebraska long-term care savings plan account at a participating Nebraska financial institution. There is no age restriction to participate in the plan; however, there are restrictions on withdrawals from a qualified long-term care savings plan (see below).

A “participating Nebraska financial institution” is a bank, savings bank, credit union, or other financial institution which has entered into an agreement with the State Treasurer to participate in the Nebraska Long-Term Care Savings Plan. To find an approved participating financial institution near you, please contact the Nebraska State Treasurer’s Office at (402) 471-2455 or see the State Treasurer’s website, www.treasurer.state.ne.us.

Nebraska law allows a deduction for the amount of annual contributions up to a maximum annual deduction of $1,000 for a single, head-of-household, or married, filing separately return, or $2,000 for a married, filing jointly return when made to a Nebraska Long-Term Care Savings Plan account with a participating Nebraska financial institution.

To claim the deduction, fill in the “Nebraska Long-Term Care Savings Plan Contribution” line on Part B of the Nebraska Schedule I and attach it to your Nebraska Individual Income Tax Return, Form1040N. An adjustment reducing federal adjusted gross income (AGI) for any interest or dividends earned on deposits in a Nebraska Long-Term Care Savings Plan account should also be made on the “Other adjustments decreasing taxable income“ line of the Schedule I.

A qualified individual may make withdrawals, as a participant, from his or her Nebraska Long-Term Care Savings Plan account to pay or reimburse qualified long-term care expenses, or to pay or reimburse long-term care insurance premiums.

A “qualified individual” is a person who:

  • incurred long-term care expenses during the taxable year; or
     
  • turned 50 years of age or older during the taxable year, and made payments for long-term care insurance premiums during the taxable year.

“Qualified long-term care expense” means the cost of long-term care in a long-term care facility or the cost of care provided in a person’s home when the person receiving the care is unable to perform multiple basic life functions independently. For more details, see the State Treasurer’s website, www.treasurer.state.ne.us.

“Qualified long-term care insurance premiums” means premiums paid for a long-term care insurance policy that offers coverage to a qualified individual, the individual’s spouse, or another person for whom the qualified individual has an insurable interest.

Any participant who makes a withdrawal for any use other than transfer of account funds to a spouse, payment of long-term care expenses, payment of long-term care insurance premiums, or the death of the participant shall be subject to a ten-percent penalty on the amount withdrawn. In addition, federal AGI as reported on the taxpayer’s Nebraska income tax return must be increased by the amount of such non-qualified withdrawals up to the amount previously deducted on the participant’s Nebraska income tax returns. This amount is reported as an “Adjustment Increasing Federal AGI” on the Nebraska Schedule I.


Back to top of page


Official Nebraska State Government Home Page | Privacy Policy | About Outside Links