Devon Financial Partners l Plan, Protect, Prosper l http://www.devon-financial.com

Long Term Care Insurance

for Today's Business

Business Owners, in particular, have some very compelling reasons to consider having long term insurance, for themselves, their key employees or even the entire workforce.

Financial Benefits for Business Owners and Their Employees*

Certainly, providing long term care insurance to employees — either on an employer-paid or voluntary (employee-paid) basis — can help a small business enhance productivity and retain staff.

But business owners may not be aware of the tax advantages and other financial benefits they can realize by offering this particular type of coverage:

Businesses are able to deduct the full premium paid for long term care insurance coverage on behalf of employees and their spouses or dependents. This includes shareholder-employees of C Corporations.

Owners of LLCs, sole proprietorships, partnerships or those with more than 2% ownership of an S Corporation also enjoy significant tax benefits on company-paid premiums for their own policies.

Many long term care insurance carriers offer a discounted premium rate for qualified businesses and associations.

Some insurance carriers even offer premium payment options that enable business owners to have their premiums fully paid by the time they retire.

Employees can derive certain tax advantages by having long term care insurance in place — whether their employer fully funds the coverage (1), pays part of the premiums or simply makes it available to them

Employees generally pay no income tax on employer contributions.

Employee contributions can be made through payroll deduction or billed directly.

Benefits are generally tax-free, even for employer-paid policies.

And the popularity of employer-provided long term care insurance benefits is growing.

According to an article published by the U.S. Department of Labor's Bureau of Labor Statistics (2), 13% of full-time employees in all private industry were offered such coverage by 2003, while 19% of full-time employees in private establishments of 100 or more had access to this benefit.

Odds, Cost Both Too High to Ignore

Why does it make sense for companies and individuals to plan for long term care sooner rather than later? The chance that any individual will require long term care — defined as assistance with daily activities such as getting dressed, bathing, eating, moving from place to place and using the bathroom — is substantial.

The cost of this type of care is another compelling reason to plan for long term care funding before it's needed. Round-the-clock home care provided by a nurse can cost more than $300,000 a year.

Medical and nursing home costs have been increasing annually far faster than the consumer price index.

1 In New York, employers may only pay up to 50% of long term care insurance premiums.

2 Long Term Care Insurance Gains Prominence™, 2004 U.S. Department of Labor, Bureau of Labor Statistics.

*This publication is offered for the purposes of education and information only and should not be considered tax or legal advice. For information on your specific situation, please consult your legal or tax advisor.

744 W. Lancaster Avenue . Suite 235 . Wayne . PA 19087 I Phone: 610.293.8300 I Fax: 610.293.8399

Financial Representative of The Guardian Life Insurance Company of America, New York, NY. The Information on this site is intended for the residents of Connecticut (CT), Delaware (DE), Florida (FL), Massachusetts (MA), New Jersey (NJ), New York (NY), and Pennsylvania (PA). The financial representatives of Devon Financial Associates LLC are not licensed to sell insurance in all 50 states. To find out if an agent is licensed in your state, please contact Colleen Marzella at 610-293-8304.

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