Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

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soulreapersteve
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by soulreapersteve »

batpot wrote: Fri Jun 11, 2021 6:19 pm Has anybody found a plan that can still be established for people under 40?

Mutual of Omaha now requires you to be at least 40.
The agent I reached out to presented me a plan from Bankers Life. I'm under 40 years old.
soulreapersteve
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by soulreapersteve »

tomsense76 wrote: Fri Jun 11, 2021 6:36 pm
soulreapersteve wrote: Fri Jun 11, 2021 6:04 pm
definitelynotMike wrote: Fri Jun 11, 2021 4:38 pm
soulreapersteve wrote: Fri Jun 11, 2021 3:11 pm Hello,

I'm many decades away from expecting to utilize any form of LTC. The field I'm going into (nursing) start out @ mid 5 figures annually with no incentive/extra pay calculated and at this current time, as per published current union wage tables, top out at low 6 figures after 30 years (again, not calculating incentive or other pay).

For example: I'll probably make around 65k-70k base my first year. Someone with 30 years of experience is making around 120k/year at this time. What are thoughts for someone in my situation regarding the decision to simply pay the payroll tax or opt out? I plan on keeping a private policy for 2-3 years then dropping it completely if I were to go the opting out route.

The reason I ask is because I read somewhere else that people who make 2-300k+/yr are the main populations who should be opting out of this. Anyone making lower wages shouldn't affect them too much.
It ultimately comes down to the cost of a private plan, your current and future salary, and the amount of effort you're willing to put in for any savings and/or increased benefits of a private plan.

Here is a quick comparison of the annual cost of the tax and private plan premiums for <$100k salaries:

Image

If you plan to drop the private plan at some point after opting out of the tax then the longer-term savings calculation changes slightly.
Thank you for your response as this is exactly what I'm looking for. I was quoted for 650/year with a private plan.
Do you know what life time benefit that came with?

I could be wrong (definitely not an expert), but that sounds like that is on the higher side. Might be worth doing a bit more shopping.
$100,000 lifetime benefit. I was presented a plan that was a bit higher than the proposed state benefits, but I don't mind it being a little more pricy if it meant the state won't reject my application for opting out. Plus, I won't be keeping this plan for the next 30+ years.
it'smyjob?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by it'smyjob? »

I'm a little late to the game here.
I don't know what I find more upsetting: the adoption of this WA Cares program, or the fact that I completely missed hearing about it until now.
Seriously, I know every detail of the American Rescue Plan in terms of how it affects one of my children. But I never heard anything about this long term care requirement. How is that possible? My son told me after finding out his roommate was looking for LTCI to exempt himself (and then plans to drop it). I spoke to a friend who is always on top of these things. She never heard of it, either. I think I may take a survey...

I am furious at the details of this act, and how it seems to have intentionally been slipped under the radar of many (most?). We had planned to self-insure. Of course, we are in the group who will not be eligible to actually use the LT care we will pay for. My son will need to scramble to secure private insurance for the exemption.

This is just a clear excuse to establish an income tax. I suppose I would feel better if that was what it was called. Instead, there is a short window for those in the know to purchase private LTCI, and then drop it so as to avoid the tax. I'm assuming that anyone who joins the job force (W2) after the deadline will have no opportunity to exempt themselves. And why should the self-employed be exempt? (You only have to pay if we can catch you?) The mere fact that a twenty-something would be forced to buy LTCI is beyond comprehension. Those who will contribute the most to this plan (highest salary close to retirement, or tech worker, etc) have the lowest probability of using the benefits due to eligibility requirements or migration to another state.

Why has there not been any protest or public outrage about this? (Or did I miss that, too?)
Topic Author
Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

it'smyjob? wrote: Sat Jun 12, 2021 12:14 pm Why has there not been any protest or public outrage about this? (Or did I miss that, too?)
The outrage will be in January when the tax starts and the opt out window has passed.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

Soon2BXProgrammer wrote: Sat Jun 12, 2021 12:23 pm
it'smyjob? wrote: Sat Jun 12, 2021 12:14 pm Why has there not been any protest or public outrage about this? (Or did I miss that, too?)
The outrage will be in January when the tax starts and the opt out window has passed.
That's why the deadline to purchase LTCi has changed so often.
In the first version of the legislation, anyone could buy LTCi up through 12/31/2022 and be able to opt-out of the tax.
Then they tried to change it so that only people who owned LTCi before the law was signed (May, 2019) could opt-out of the tax.
Then they tried to change it so that you had to buy the insurance before 7/24/2021 in order to be able to opt-out.
The Senate strong armed the house and finally ended with a purchase deadline of 11/1/2021.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Isabelle77
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Isabelle77 »

Kookaburra wrote: Fri Jun 11, 2021 4:57 pm
Isabelle77 wrote: Thu Apr 29, 2021 11:57 am Scott Olson
Scott@ltcshop.com
Office: 877-727-9582


This is the agent we are using, he's on the west side but nowhere near us. Very reasonable quotes, we wound up choosing a Banker's Life policy that covers exactly what the new WA state plan will. $100 a day up to 365 days.
What did this agent assume for: the elimination period? The inflation component?

Would you mind sharing what premium quote you received, and age/gender?
30 day elimination period, 2% inflation. It's for my husband who is 44 and a pretty healthy male :) Should note that we have been waiting for final approval now for over a month, they're very backed up.
tsama
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tsama »

This is my first time posting. I landed on this board as I was searching WA LTC new tax. I just wanted to let everyone know that this tax is not only for WA residents but also residents of other states will be subject to it. The reason being is if your employer's headquarters i.e. Microsoft, Amazon are in WA, your payroll is from WA and you will be subject to this payroll tax. I had this info confirmed by 2 sources; a broker and Transamerica. Please let your colleagues who are out of state and work for a WA employer know. This is an outrageous tax forcing our hands to pay for something that is a subpar LTC insurance. I wish people in WA would wake up to what's been done to them. [OT comment removed by admin LadyGeek]
chupapa
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by chupapa »

Isabelle77 wrote: Sat Jun 12, 2021 1:34 pm
Kookaburra wrote: Fri Jun 11, 2021 4:57 pm
Isabelle77 wrote: Thu Apr 29, 2021 11:57 am Scott Olson
Scott@ltcshop.com
Office: 877-727-9582


This is the agent we are using, he's on the west side but nowhere near us. Very reasonable quotes, we wound up choosing a Banker's Life policy that covers exactly what the new WA state plan will. $100 a day up to 365 days.
What did this agent assume for: the elimination period? The inflation component?

Would you mind sharing what premium quote you received, and age/gender?
30 day elimination period, 2% inflation. It's for my husband who is 44 and a pretty healthy male :) Should note that we have been waiting for final approval now for over a month, they're very backed up.
how much did you get quote for? and are you planning to keep the policy?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by LadyGeek »

Discussions of dishonest behavior or bypassing the law is totally unacceptable.

Several posts suggesting someone attest they have an existing LTC policy to avoid paying the tax (but actually do not) have been removed.

Also, this is a "No politics" forum. A political comment has also been removed.
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WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

tsama wrote: Sat Jun 12, 2021 10:19 pm This is my first time posting. I landed on this board as I was searching WA LTC new tax. I just wanted to let everyone know that this tax is not only for WA residents but also residents of other states will be subject to it. The reason being is if your employer's headquarters i.e. Microsoft, Amazon are in WA, your payroll is from WA and you will be subject to this payroll tax. I had this info confirmed by 2 sources; a broker and Transamerica. Please let your colleagues who are out of state and work for a WA employer know. This is an outrageous tax forcing our hands to pay for something that is a subpar LTC insurance. I wish people in WA would wake up to what's been done to them. [OT comment removed by admin LadyGeek]

I believe you are mistaken. Nowhere in the legislation does it say that employees in other states have to pay this tax. Do microsoft employees in other states have to pay the Washington FML tax?

Do you have any source that is more substantial than "a broker and Transamerica?"
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
tsama
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tsama »

WoW2012 wrote: Sun Jun 13, 2021 7:47 am
tsama wrote: Sat Jun 12, 2021 10:19 pm This is my first time posting. I landed on this board as I was searching WA LTC new tax. I just wanted to let everyone know that this tax is not only for WA residents but also residents of other states will be subject to it. The reason being is if your employer's headquarters i.e. Microsoft, Amazon are in WA, your payroll is from WA and you will be subject to this payroll tax. I had this info confirmed by 2 sources; a broker and Transamerica. Please let your colleagues who are out of state and work for a WA employer know. This is an outrageous tax forcing our hands to pay for something that is a subpar LTC insurance. I wish people in WA would wake up to what's been done to them. [OT comment removed by admin LadyGeek]

I believe you are mistaken. Nowhere in the legislation does it say that employees in other states have to pay this tax. Do microsoft employees in other states have to pay the Washington FML tax?

Do you have any source that is more substantial than "a broker and Transamerica?"
This is what I have verified for myself and other friends. Please check for yourself. I am only responsible for my own situation but I wanted sound the alarm at least for people to do their own research and I am not affiliated with any insurance company.
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CardinalRule
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by CardinalRule »

tsama wrote: Sun Jun 13, 2021 10:03 am
WoW2012 wrote: Sun Jun 13, 2021 7:47 am
tsama wrote: Sat Jun 12, 2021 10:19 pm This is my first time posting. I landed on this board as I was searching WA LTC new tax. I just wanted to let everyone know that this tax is not only for WA residents but also residents of other states will be subject to it. The reason being is if your employer's headquarters i.e. Microsoft, Amazon are in WA, your payroll is from WA and you will be subject to this payroll tax. I had this info confirmed by 2 sources; a broker and Transamerica. Please let your colleagues who are out of state and work for a WA employer know. This is an outrageous tax forcing our hands to pay for something that is a subpar LTC insurance. I wish people in WA would wake up to what's been done to them. [OT comment removed by admin LadyGeek]

I believe you are mistaken. Nowhere in the legislation does it say that employees in other states have to pay this tax. Do microsoft employees in other states have to pay the Washington FML tax?

Do you have any source that is more substantial than "a broker and Transamerica?"
This is what I have verified for myself and other friends. Please check for yourself. I am only responsible for my own situation but I wanted sound the alarm at least for people to do their own research and I am not affiliated with any insurance company.
Your "verified" information is just wrong. If you work for say, Microsoft, the company has to determine whether which state you are a resident of, for income tax and various other purposes. If you work for Microsoft but live and work in the Silicon Valley, you will pay California income tax, for example. But the Washington FML tax would not apply to you.
chupapa
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by chupapa »

So a curiosity as a female younger than 40 that are searching now, the cheapest LTCi I get is ~80. I also get another quote for VUL which LTC rider and pay for 10 years ($110 monthly), hopefully the policy will last until ages 90+ but I do aware of all the high premium and everything. Just because of WA force me to buy LTC and now all insurance companies really increase the rate to the point that I am considering IUL/VUL again. At this point, do you think would it worth to consider the IUL/VUL policy? (100k death benefit 3% LTC rider ~ 3,000 monthly)
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

chupapa wrote: Sun Jun 13, 2021 6:30 pm So a curiosity as a female younger than 40 that are searching now, the cheapest LTCi I get is ~80. I also get another quote for VUL which LTC rider and pay for 10 years ($110 monthly), hopefully the policy will last until ages 90+ but I do aware of all the high premium and everything. Just because of WA force me to buy LTC and now all insurance companies really increase the rate to the point that I am considering IUL/VUL again. At this point, do you think would it worth to consider the IUL/VUL policy? (100k death benefit 3% LTC rider ~ 3,000 monthly)
You can buy a $50k John Hancock regular UL policy with 100% LTC rider/2% withdrawal per month for around $300-500 per year depending on your age and health. Upgrading to the 4% withdrawal option only costs about an extra $10-20 per year.
APX32
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by APX32 »

it'smyjob? wrote: Sat Jun 12, 2021 12:14 pm I'm a little late to the game here.
I don't know what I find more upsetting: the adoption of this WA Cares program, or the fact that I completely missed hearing about it until now.
Seriously, I know every detail of the American Rescue Plan in terms of how it affects one of my children. But I never heard anything about this long term care requirement. How is that possible? My son told me after finding out his roommate was looking for LTCI to exempt himself (and then plans to drop it). I spoke to a friend who is always on top of these things. She never heard of it, either. I think I may take a survey...

I am furious at the details of this act, and how it seems to have intentionally been slipped under the radar of many (most?). We had planned to self-insure. Of course, we are in the group who will not be eligible to actually use the LT care we will pay for. My son will need to scramble to secure private insurance for the exemption.

This is just a clear excuse to establish an income tax. I suppose I would feel better if that was what it was called. Instead, there is a short window for those in the know to purchase private LTCI, and then drop it so as to avoid the tax. I'm assuming that anyone who joins the job force (W2) after the deadline will have no opportunity to exempt themselves. And why should the self-employed be exempt? (You only have to pay if we can catch you?) The mere fact that a twenty-something would be forced to buy LTCI is beyond comprehension. Those who will contribute the most to this plan (highest salary close to retirement, or tech worker, etc) have the lowest probability of using the benefits due to eligibility requirements or migration to another state.

Why has there not been any protest or public outrage about this? (Or did I miss that, too?)
The reason why so many people don’t know about this law is that the lawmakers appear to have done their absolute best to keep this one under the covers. I consider myself well informed when it comes to such matters, but I also found out about it through some astute co-workers who become aware of it and shared the news. It then spread fairly quickly within my company that benefits decided to step in with a number of intra-company info sessions and the group plan to assist with the opt-out process.

I imagine unless you hear about it through some sort of word-of-mouth, you’re in for a surprise come January 2022. The local media is also complicit in completely burying the story instead of keeping the public informed.

As to your last question, the reason there hasn’t been widespread public outrage is mainly because most people don’t know about it. Those who find out are pretty angry and rightfully so. There’s also a political element at play, but I respect the forum rules so I won’t go there.
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chupapa
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by chupapa »

BruDude wrote: Sun Jun 13, 2021 6:40 pm
chupapa wrote: Sun Jun 13, 2021 6:30 pm So a curiosity as a female younger than 40 that are searching now, the cheapest LTCi I get is ~80. I also get another quote for VUL which LTC rider and pay for 10 years ($110 monthly), hopefully the policy will last until ages 90+ but I do aware of all the high premium and everything. Just because of WA force me to buy LTC and now all insurance companies really increase the rate to the point that I am considering IUL/VUL again. At this point, do you think would it worth to consider the IUL/VUL policy? (100k death benefit 3% LTC rider ~ 3,000 monthly)
You can buy a $50k John Hancock regular UL policy with 100% LTC rider/2% withdrawal per month for around $300-500 per year depending on your age and health. Upgrading to the 4% withdrawal option only costs about an extra $10-20 per year.
Thanks, I will look for that one but 50k with 2% rider, that's $1000 a month which is less than the state program, that will make it qualify?
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

chupapa wrote: Mon Jun 14, 2021 12:29 am
BruDude wrote: Sun Jun 13, 2021 6:40 pm
chupapa wrote: Sun Jun 13, 2021 6:30 pm So a curiosity as a female younger than 40 that are searching now, the cheapest LTCi I get is ~80. I also get another quote for VUL which LTC rider and pay for 10 years ($110 monthly), hopefully the policy will last until ages 90+ but I do aware of all the high premium and everything. Just because of WA force me to buy LTC and now all insurance companies really increase the rate to the point that I am considering IUL/VUL again. At this point, do you think would it worth to consider the IUL/VUL policy? (100k death benefit 3% LTC rider ~ 3,000 monthly)
You can buy a $50k John Hancock regular UL policy with 100% LTC rider/2% withdrawal per month for around $300-500 per year depending on your age and health. Upgrading to the 4% withdrawal option only costs about an extra $10-20 per year.
Thanks, I will look for that one but 50k with 2% rider, that's $1000 a month which is less than the state program, that will make it qualify?
There’s no stated benefit minimums. It qualifies as LTC under the state’s definition. If you’re concerned that it may not you can opt for the 4% rider for a few extra bucks per year.
it'smyjob?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by it'smyjob? »

APX32 wrote: Sun Jun 13, 2021 11:42 pm
it'smyjob? wrote: Sat Jun 12, 2021 12:14 pm I'm a little late to the game here.
I don't know what I find more upsetting: the adoption of this WA Cares program, or the fact that I completely missed hearing about it until now.
Seriously, I know every detail of the American Rescue Plan in terms of how it affects one of my children. But I never heard anything about this long term care requirement. How is that possible? My son told me after finding out his roommate was looking for LTCI to exempt himself (and then plans to drop it). I spoke to a friend who is always on top of these things. She never heard of it, either. I think I may take a survey...

I am furious at the details of this act, and how it seems to have intentionally been slipped under the radar of many (most?). We had planned to self-insure. Of course, we are in the group who will not be eligible to actually use the LT care we will pay for. My son will need to scramble to secure private insurance for the exemption.

This is just a clear excuse to establish an income tax. I suppose I would feel better if that was what it was called. Instead, there is a short window for those in the know to purchase private LTCI, and then drop it so as to avoid the tax. I'm assuming that anyone who joins the job force (W2) after the deadline will have no opportunity to exempt themselves. And why should the self-employed be exempt? (You only have to pay if we can catch you?) The mere fact that a twenty-something would be forced to buy LTCI is beyond comprehension. Those who will contribute the most to this plan (highest salary close to retirement, or tech worker, etc) have the lowest probability of using the benefits due to eligibility requirements or migration to another state.

Why has there not been any protest or public outrage about this? (Or did I miss that, too?)
The reason why so many people don’t know about this law is that the lawmakers appear to have done their absolute best to keep this one under the covers. I consider myself well informed when it comes to such matters, but I also found out about it through some astute co-workers who become aware of it and shared the news. It then spread fairly quickly within my company that benefits decided to step in with a number of intra-company info sessions and the group plan to assist with the opt-out process.

I imagine unless you hear about it through some sort of word-of-mouth, you’re in for a surprise come January 2022. The local media is also complicit in completely burying the story instead of keeping the public informed.

As to your last question, the reason there hasn’t been widespread public outrage is mainly because most people don’t know about it. Those who find out are pretty angry and rightfully so. There’s also a political element at play, but I respect the forum rules so I won’t go there.
Absolutely. I agree. My son's company is arranging for employees to secure private LTC. A more fastidious coworker (who pays attention to company email notices) mentioned it to my son, who told me. Otw, we certainly would not have heard...

Does the WA CARES act provide LTC only for the contributor? or for a spouse instead ( or, as well)? That also complicates things!
SweetFire
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by SweetFire »

I applied for a couple of policies since it seems like they are all overwhelmed and I don't want to miss the opt out window. All of them required a one month premium with the application Is there a time window for penalty free cancellation.
czaj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by czaj »

SweetFire wrote: Tue Jun 15, 2021 4:16 pm I applied for a couple of policies since it seems like they are all overwhelmed and I don't want to miss the opt out window. All of them required a one month premium with the application Is there a time window for penalty free cancellation.
Can you decline the policy after an application is approved? I assume you have to at least pay the initial premium.
Topic Author
Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

it'smyjob? wrote: Mon Jun 14, 2021 4:15 pm Does the WA CARES act provide LTC only for the contributor? or for a spouse instead ( or, as well)? That also complicates things!
Only the worker/contributor. No spousal benefit.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
it'smyjob?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by it'smyjob? »

Soon2BXProgrammer wrote: Tue Jun 15, 2021 5:07 pm
it'smyjob? wrote: Mon Jun 14, 2021 4:15 pm Does the WA CARES act provide LTC only for the contributor? or for a spouse instead ( or, as well)? That also complicates things!
Only the worker/contributor. No spousal benefit.
Wow. That makes it even worse. So, if a married couple with single income actually intends to purchase private LT care insurance, they couldn't purchase a combined plan from a private LTC insurer without duplicating coverage if the working spouse has not opted out of WA cares. Absurd.
Topic Author
Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

it'smyjob? wrote: Tue Jun 15, 2021 11:29 pm
Soon2BXProgrammer wrote: Tue Jun 15, 2021 5:07 pm
it'smyjob? wrote: Mon Jun 14, 2021 4:15 pm Does the WA CARES act provide LTC only for the contributor? or for a spouse instead ( or, as well)? That also complicates things!
Only the worker/contributor. No spousal benefit.
Wow. That makes it even worse. So, if a married couple with single income actually intends to purchase private LT care insurance, they couldn't purchase a combined plan from a private LTC insurer without duplicating coverage if the working spouse has not opted out of WA cares. Absurd.
I am probably wrong, but i've seen policies that that both spouses by, and you add a rider that allows the other spouse uses if they run out of their own benefit... but i haven't seen policies as your describing... (the ones i've seen, are two individual policies with riders for shared benefits, because if a divorce happens, the shared riders are just canceled....)
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
okayplayer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by okayplayer »

I'm curious what percentage of folks in WA who have acquired these LTC policies strictly as a means to avoid this tax (ie. these individuals have no interest in holding a LTC policy otherwise) plan to drop the policies as soon as they receive notice their lifetime exception was approved?

Anyone planning on retaining the policy for a few years prior to dropping it to make sure the state won't come after folks who dropped their LTC policy after acquiring the lifetime exception?
definitelynotMike
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by definitelynotMike »

okayplayer wrote: Wed Jun 16, 2021 7:48 am I'm curious what percentage of folks in WA who have acquired these LTC policies strictly as a means to avoid this tax (ie. these individuals have no interest in holding a LTC policy otherwise) plan to drop the policies as soon as they receive notice their lifetime exception was approved?

Anyone planning on retaining the policy for a few years prior to dropping it to make sure the state won't come after folks who dropped their LTC policy after acquiring the lifetime exception?
The law as it is currently written says "An employee who attests that the employee has long-term care insurance purchased before November 1, 2021, may apply for an exemption from the premium assessment." There is currently no requirement to hold the plan beyond November 1, 2021 and without a change in the law any audits the state does would only be to ensure you actually held a valid plan prior to November 1, 2021.

The bigger question to ask yourself is whether you think the legislature will change the law to unexempt those who had policies on November 1, 2021 and then cancelled them, but that is beyond the scope of what can be discussed here.
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

definitelynotMike wrote: Wed Jun 16, 2021 12:18 pm
okayplayer wrote: Wed Jun 16, 2021 7:48 am I'm curious what percentage of folks in WA who have acquired these LTC policies strictly as a means to avoid this tax (ie. these individuals have no interest in holding a LTC policy otherwise) plan to drop the policies as soon as they receive notice their lifetime exception was approved?

Anyone planning on retaining the policy for a few years prior to dropping it to make sure the state won't come after folks who dropped their LTC policy after acquiring the lifetime exception?
The law as it is currently written says "An employee who attests that the employee has long-term care insurance purchased before November 1, 2021, may apply for an exemption from the premium assessment." There is currently no requirement to hold the plan beyond November 1, 2021 and without a change in the law any audits the state does would only be to ensure you actually held a valid plan prior to November 1, 2021.

The bigger question to ask yourself is whether you think the legislature will change the law to unexempt those who had policies on November 1, 2021 and then cancelled them, but that is beyond the scope of what can be discussed here.
Lincoln National is now requiring a minimum up-front premium of $7500 in Washington state for their MoneyGuard linked benefit LTC product. I will not be surprised to see the companies selling LTC and life insurance policies with TLC riders to start requiring something like two years of premium up front, or holding the contract for a minimum of one or two years. They don't want to go through all of the underwriting and associated costs for these policies and then wind up with half of them being canceled as soon as people get their exemptions. Insurance companies aren't stupid, they will find a way to fix that problem and it probably will not be consumer-friendly.
tomsense76
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tomsense76 »

Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.
tomsense76
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tomsense76 »

BruDude wrote: Wed Jun 16, 2021 3:19 pm
tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.
Thanks for the feedback! Will look into this further.

Do you have a sense of what the premium range is?
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BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

tomsense76 wrote: Wed Jun 16, 2021 4:00 pm
BruDude wrote: Wed Jun 16, 2021 3:19 pm
tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.
Thanks for the feedback! Will look into this further.

Do you have a sense of what the premium range is?
Completely depends on your age and health. For a 40 year old male that qualifies for the best health rating it would be around $420/year, a 35-year old should be around $350 or so. Around $300 for a 30 year old. Goes up from there if you only qualify for a lower health rating. I had a 35 year old female the other day that applied and it was $315 per year assuming best rating.
tomsense76
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tomsense76 »

BruDude wrote: Wed Jun 16, 2021 4:29 pm
tomsense76 wrote: Wed Jun 16, 2021 4:00 pm
BruDude wrote: Wed Jun 16, 2021 3:19 pm
tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.
Thanks for the feedback! Will look into this further.

Do you have a sense of what the premium range is?
Completely depends on your age and health. For a 40 year old male that qualifies for the best health rating it would be around $420/year, a 35-year old should be around $350 or so. Around $300 for a 30 year old. Goes up from there if you only qualify for a lower health rating. I had a 35 year old female the other day that applied and it was $315 per year assuming best rating.
Yep that makes sense. Sounds pretty reasonable. Thanks for the info! :)
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by APX32 »

okayplayer wrote: Wed Jun 16, 2021 7:48 am I'm curious what percentage of folks in WA who have acquired these LTC policies strictly as a means to avoid this tax (ie. these individuals have no interest in holding a LTC policy otherwise) plan to drop the policies as soon as they receive notice their lifetime exception was approved?

Anyone planning on retaining the policy for a few years prior to dropping it to make sure the state won't come after folks who dropped their LTC policy after acquiring the lifetime exception?
It’s pretty much everyone I know or heard about through the internal company forum. A small sampling perhaps but several dozen people all of whom are getting private LTC for the explicit purpose of opting out.

The timelines on dropping the private plan vary. Some (like myself) will keep their plan for one year and then not renew. Other have indicated a few months after getting their exemption, while some folks will only hold their plan for 1-2 months. Everyone simply wants to opt-out of this ridiculous state plan.

I don’t think lawmakers will change anything. The way the law is written, they are giving an out to people as a one-time option this year, but counting on making up for any losses by making sure all future W2 employees are permanently trapped with no way to opt out.

Since the exemption is permanent once you opt out, there’s no provision that the state will come after you and forcibly opt you back in following an audit that shows you no longer have a plan.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jemscreen392 »

BruDude wrote: Wed Jun 16, 2021 3:19 pm
tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.

The way I read things, your under-40 clients buying the John Hancock Protection UL with LTC rider are going to get screwed. Unless there's been yet another change, the law clearly states that the LTCi must be its own policy - not a hybrid UL with LTC added on. So your clients are getting bad advice from....someone.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

jemscreen392 wrote: Thu Jun 17, 2021 6:39 pm
BruDude wrote: Wed Jun 16, 2021 3:19 pm
tomsense76 wrote: Wed Jun 16, 2021 2:36 pm Am having a lot of difficulty finding LTC insurance that will take someone under 40 in WA. One suggestion has been to look into LTC + Life. Am not sure if this is a good idea. Should add I'm single without dependents. Does anyone have thoughts?
My under-40 clients have been buying the John Hancock Protection UL with LTC rider. They're the only company that goes down to a $50k benefit minimum. Nationwide and Lincoln National have a $100k minimum. I would say there is a strong possibility that Hancock increases their minimum to $100k in the near future. Insurance companies are rapidly changing their rules and requirements for LTC-qualified policies in Washington.

The way I read things, your under-40 clients buying the John Hancock Protection UL with LTC rider are going to get screwed. Unless there's been yet another change, the law clearly states that the LTCi must be its own policy - not a hybrid UL with LTC added on. So your clients are getting bad advice from....someone.
UL policies with a qualified LTC rider are considered LTC under the WA state definition as they meet the IRS section 7702b requirements for qualified LTC. See here - https://app.leg.wa.gov/RCW/default.aspx?cite=48.83.020
(5) "Long-term care insurance" means an insurance policy, contract, or rider that is advertised, marketed, offered, or designed to provide coverage for at least twelve consecutive months for a covered person. Long-term care insurance may be on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes any policy, contract, or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity.
(a) Long-term care insurance includes group and individual annuities and life insurance policies or riders that provide directly or supplement long-term care insurance. However, long-term care insurance does not include life insurance policies that: (i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement; (ii) provide the option of a lump sum payment for those benefits; and (iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.
(b) Long-term care insurance also includes qualified long-term care insurance contracts.
Accelerated benefit riders are not qualified LTC, but true LTC riders such as the one in the John Hancock policy do qualify. John Hancock's representatives have reiterated to our brokerage that their life/LTC policy does qualify. I am not a lawyer and I don't make the WA state laws, I can only go based off what information is available at this time. If you have evidence that refutes this, please share.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by miuichigo »

BruDude wrote: Thu Jun 17, 2021 7:05 pm
jemscreen392 wrote: Thu Jun 17, 2021 6:39 pm The way I read things, your under-40 clients buying the John Hancock Protection UL with LTC rider are going to get screwed. Unless there's been yet another change, the law clearly states that the LTCi must be its own policy - not a hybrid UL with LTC added on. So your clients are getting bad advice from....someone.
UL policies with a qualified LTC rider are considered LTC under the WA state definition as they meet the IRS section 7702b requirements for qualified LTC. See here - https://app.leg.wa.gov/RCW/default.aspx?cite=48.83.020
(5) "Long-term care insurance" means an insurance policy, contract, or rider that is advertised, marketed, offered, or designed to provide coverage for at least twelve consecutive months for a covered person. Long-term care insurance may be on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes any policy, contract, or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity.
(a) Long-term care insurance includes group and individual annuities and life insurance policies or riders that provide directly or supplement long-term care insurance. However, long-term care insurance does not include life insurance policies that: (i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement; (ii) provide the option of a lump sum payment for those benefits; and (iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.
(b) Long-term care insurance also includes qualified long-term care insurance contracts.
Accelerated benefit riders are not qualified LTC, but true LTC riders such as the one in the John Hancock policy do qualify. John Hancock's representatives have reiterated to our brokerage that their life/LTC policy does qualify. I am not a lawyer and I don't make the WA state laws, I can only go based off what information is available at this time. If you have evidence that refutes this, please share.
I'm curious about this as well... the quote I'd received for John Hancock w/ a "Long-Term Care Rider" states "The Long-Term Care rider is designed to accelerate all or a portion of the Total Face Amount or Face Amount (depending on which term is used in your policy) under the policy in order to reimburse a Chronically Ill insured for expenses incurred for receipt of Qualified Long-Term Care Services."

The "accelerate" language makes me wonder if it's not qualified...or if there's some other "Long-Term Care Rider" that isn't the one I was presented with.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

miuichigo wrote: Thu Jun 17, 2021 7:22 pm
BruDude wrote: Thu Jun 17, 2021 7:05 pm
jemscreen392 wrote: Thu Jun 17, 2021 6:39 pm The way I read things, your under-40 clients buying the John Hancock Protection UL with LTC rider are going to get screwed. Unless there's been yet another change, the law clearly states that the LTCi must be its own policy - not a hybrid UL with LTC added on. So your clients are getting bad advice from....someone.
UL policies with a qualified LTC rider are considered LTC under the WA state definition as they meet the IRS section 7702b requirements for qualified LTC. See here - https://app.leg.wa.gov/RCW/default.aspx?cite=48.83.020
(5) "Long-term care insurance" means an insurance policy, contract, or rider that is advertised, marketed, offered, or designed to provide coverage for at least twelve consecutive months for a covered person. Long-term care insurance may be on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes any policy, contract, or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity.
(a) Long-term care insurance includes group and individual annuities and life insurance policies or riders that provide directly or supplement long-term care insurance. However, long-term care insurance does not include life insurance policies that: (i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement; (ii) provide the option of a lump sum payment for those benefits; and (iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.
(b) Long-term care insurance also includes qualified long-term care insurance contracts.
Accelerated benefit riders are not qualified LTC, but true LTC riders such as the one in the John Hancock policy do qualify. John Hancock's representatives have reiterated to our brokerage that their life/LTC policy does qualify. I am not a lawyer and I don't make the WA state laws, I can only go based off what information is available at this time. If you have evidence that refutes this, please share.
I'm curious about this as well... the quote I'd received for John Hancock w/ a "Long-Term Care Rider" states "The Long-Term Care rider is designed to accelerate all or a portion of the Total Face Amount or Face Amount (depending on which term is used in your policy) under the policy in order to reimburse a Chronically Ill insured for expenses incurred for receipt of Qualified Long-Term Care Services."

The "accelerate" language makes me wonder if it's not qualified...or if there's some other "Long-Term Care Rider" that isn't the one I was presented with.
Check the "Long Term Care rider" section of the illustration to make sure it says "Qualified Long Term Care services are intended to constitute qualified long-term care services as defined under Section 7702B(c) of the Internal Revenue Code"
miuichigo
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by miuichigo »

BruDude wrote: Thu Jun 17, 2021 8:25 pm
miuichigo wrote: Thu Jun 17, 2021 7:22 pm
BruDude wrote: Thu Jun 17, 2021 7:05 pm
UL policies with a qualified LTC rider are considered LTC under the WA state definition as they meet the IRS section 7702b requirements for qualified LTC. See here - https://app.leg.wa.gov/RCW/default.aspx?cite=48.83.020
(5) "Long-term care insurance" means an insurance policy, contract, or rider that is advertised, marketed, offered, or designed to provide coverage for at least twelve consecutive months for a covered person. Long-term care insurance may be on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes any policy, contract, or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity.
(a) Long-term care insurance includes group and individual annuities and life insurance policies or riders that provide directly or supplement long-term care insurance. However, long-term care insurance does not include life insurance policies that: (i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement; (ii) provide the option of a lump sum payment for those benefits; and (iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.
(b) Long-term care insurance also includes qualified long-term care insurance contracts.
Accelerated benefit riders are not qualified LTC, but true LTC riders such as the one in the John Hancock policy do qualify. John Hancock's representatives have reiterated to our brokerage that their life/LTC policy does qualify. I am not a lawyer and I don't make the WA state laws, I can only go based off what information is available at this time. If you have evidence that refutes this, please share.
I'm curious about this as well... the quote I'd received for John Hancock w/ a "Long-Term Care Rider" states "The Long-Term Care rider is designed to accelerate all or a portion of the Total Face Amount or Face Amount (depending on which term is used in your policy) under the policy in order to reimburse a Chronically Ill insured for expenses incurred for receipt of Qualified Long-Term Care Services."

The "accelerate" language makes me wonder if it's not qualified...or if there's some other "Long-Term Care Rider" that isn't the one I was presented with.
Check the "Long Term Care rider" section of the illustration to make sure it says "Qualified Long Term Care services are intended to constitute qualified long-term care services as defined under Section 7702B(c) of the Internal Revenue Code"
Yes, it does have references to 7702B(c). The phrasing in the RCW seems to explicitly warn against "accelerated" benefits and most if not all LTC Riders seem to have this word somewhere in the narrative even if it's not in the rider title itself, which is where I think a lot of the uncertainty comes from though.
Topic Author
Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

miuichigo wrote: Thu Jun 17, 2021 8:54 pm
BruDude wrote: Thu Jun 17, 2021 8:25 pm
miuichigo wrote: Thu Jun 17, 2021 7:22 pm
BruDude wrote: Thu Jun 17, 2021 7:05 pm
UL policies with a qualified LTC rider are considered LTC under the WA state definition as they meet the IRS section 7702b requirements for qualified LTC. See here - https://app.leg.wa.gov/RCW/default.aspx?cite=48.83.020
(5) "Long-term care insurance" means an insurance policy, contract, or rider that is advertised, marketed, offered, or designed to provide coverage for at least twelve consecutive months for a covered person. Long-term care insurance may be on an expense incurred, indemnity, prepaid, or other basis, for one or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. Long-term care insurance includes any policy, contract, or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity.
(a) Long-term care insurance includes group and individual annuities and life insurance policies or riders that provide directly or supplement long-term care insurance. However, long-term care insurance does not include life insurance policies that: (i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement; (ii) provide the option of a lump sum payment for those benefits; and (iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.
(b) Long-term care insurance also includes qualified long-term care insurance contracts.
Accelerated benefit riders are not qualified LTC, but true LTC riders such as the one in the John Hancock policy do qualify. John Hancock's representatives have reiterated to our brokerage that their life/LTC policy does qualify. I am not a lawyer and I don't make the WA state laws, I can only go based off what information is available at this time. If you have evidence that refutes this, please share.
I'm curious about this as well... the quote I'd received for John Hancock w/ a "Long-Term Care Rider" states "The Long-Term Care rider is designed to accelerate all or a portion of the Total Face Amount or Face Amount (depending on which term is used in your policy) under the policy in order to reimburse a Chronically Ill insured for expenses incurred for receipt of Qualified Long-Term Care Services."

The "accelerate" language makes me wonder if it's not qualified...or if there's some other "Long-Term Care Rider" that isn't the one I was presented with.
Check the "Long Term Care rider" section of the illustration to make sure it says "Qualified Long Term Care services are intended to constitute qualified long-term care services as defined under Section 7702B(c) of the Internal Revenue Code"
Yes, it does have references to 7702B(c). The phrasing in the RCW seems to explicitly warn against "accelerated" benefits and most if not all LTC Riders seem to have this word somewhere in the narrative even if it's not in the rider title itself, which is where I think a lot of the uncertainty comes from though.
There is two parts of this... "accelerated" benefits, decrease the death benefit in exchange of some other benefit. There are "living benefit riders" and "LTC riders", the first does not typically require testing for "Activities of Daily Living" (typically) and might just pay a flat amount regardless of costs, but LTC riders require the ADL test could have a different payment structure.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
tomsense76
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tomsense76 »

Am starting to going down the LTC + Life route. It's still winding up less than the taxes I would otherwise pay, but I'll admit am pretty clueless here and can't shake the sense that I'm heading down the wrong path :(
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
czaj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by czaj »

tomsense76 wrote: Fri Jun 18, 2021 5:56 pm Am starting to going down the LTC + Life route. It's still winding up less than the taxes I would otherwise pay, but I'll admit am pretty clueless here and can't shake the sense that I'm heading down the wrong path :(
Have you tried Bankers Life? They are offering standalone LTC to those under 40. Not sure if any others are.
tomsense76
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tomsense76 »

czaj wrote: Fri Jun 18, 2021 6:10 pm
tomsense76 wrote: Fri Jun 18, 2021 5:56 pm Am starting to going down the LTC + Life route. It's still winding up less than the taxes I would otherwise pay, but I'll admit am pretty clueless here and can't shake the sense that I'm heading down the wrong path :(
Have you tried Bankers Life? They are offering standalone LTC to those under 40. Not sure if any others are.
I did look at that. Not too familiar with the company. Is this them ( https://www.bbb.org/us/il/chicago/profi ... -0654-4222 )? Was a little (maybe irrationally?) nervous about some of the reviews. Also the quote I got seemed a bit steep, but maybe the info they used to generate it was too generic or it was just a result of more conservative assumptions (of what the state will accept) and perhaps a bit of price inflation(?) due to high demand

Admittedly this may just be me, but it is the mixture of the rushed nature of this process along with insurance agents trying to satisfy a significant surge in-demand with (at least some) unknowledgeable clientele. Even with everyone operating with the best of intentions, it feels like a recipe for some mistakes. Hopefully I'm wrong and these are just my own jitters
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
czaj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by czaj »

tomsense76 wrote: Fri Jun 18, 2021 7:11 pm
czaj wrote: Fri Jun 18, 2021 6:10 pm
tomsense76 wrote: Fri Jun 18, 2021 5:56 pm Am starting to going down the LTC + Life route. It's still winding up less than the taxes I would otherwise pay, but I'll admit am pretty clueless here and can't shake the sense that I'm heading down the wrong path :(
Have you tried Bankers Life? They are offering standalone LTC to those under 40. Not sure if any others are.
I did look at that. Not too familiar with the company. Is this them ( https://www.bbb.org/us/il/chicago/profi ... -0654-4222 )? Was a little (maybe irrationally?) nervous about some of the reviews. Also the quote I got seemed a bit steep, but maybe the info they used to generate it was too generic or it was just a result of more conservative assumptions (of what the state will accept) and perhaps a bit of price inflation(?) due to high demand
Yes, that’s them. I’m under 30 and was quoted $270 annual premium which includes a 35% spousal discount.
Cucumbers
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Cucumbers »

Another data point- quote from NYLife for bare-bones policy (365 waiting period, $50/day, $36500 cap, CPI inflation) was $15/month with spousal discount of 25%. If this is legit I’m not sure why everyone (even current self-employed) wouldn’t sign up!
czaj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by czaj »

Cucumbers wrote: Sat Jun 19, 2021 3:14 pm Another data point- quote from NYLife for bare-bones policy (365 waiting period, $50/day, $36500 cap, CPI inflation) was $15/month with spousal discount of 25%. If this is legit I’m not sure why everyone (even current self-employed) wouldn’t sign up!
I think some people and LTC brokers would have an issue with the $50/day since it's less than the WA state policy.

With that said, it does look appealing to me given the cost. Bankers Life isn't going that low. Who did you go through to get the quote? And is that $15/month for you alone or both of you?
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

Cucumbers wrote: Sat Jun 19, 2021 3:14 pm Another data point- quote from NYLife for bare-bones policy (365 waiting period, $50/day, $36500 cap, CPI inflation) was $15/month with spousal discount of 25%. If this is legit I’m not sure why everyone (even current self-employed) wouldn’t sign up!
Can’t imagine too many agents will be beating down the doors of their clients for a potential $100 commission on a policy that has a good chance of resulting in a chargeback when canceled after the exemption is given 😂😂

I didn’t even know NYL was still selling LTC, thought they did away with it a while ago. Maybe only their captive agents can sell it, I know my brokerage can’t even though we can sell their life insurance
MrsBDG
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by MrsBDG »

I am told by my LTC expert that there are currently no policies available in WA other than hybrids, like Lincoln MoneyGuard, OneAmerica's AssetCare and Pacific Life Premier Care . It's quite possible there is a policy offered by a company which she does not handle. I am also told that the UL with the LTC rider will not work.

Given that WA says it has all of 2022 to verify these exemptions, I would advise anyone to plan to keep it until 2023 to be sure you are not audited before dropping it. But the hybrid plans are more expensive, they do have the advantage that if you do not file an LTC claim, you do get a life insurance benefit, but they are pricey. Many were initially designed to be single premium plans.
tj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by tj »

MrsBDG wrote: Sun Jun 20, 2021 12:51 pm I am told by my LTC expert that there are currently no policies available in WA other than hybrids, like Lincoln MoneyGuard, OneAmerica's AssetCare and Pacific Life Premier Care . It's quite possible there is a policy offered by a company which she does not handle. I am also told that the UL with the LTC rider will not work.

Given that WA says it has all of 2022 to verify these exemptions, I would advise anyone to plan to keep it until 2023 to be sure you are not audited before dropping it. But the hybrid plans are more expensive, they do have the advantage that if you do not file an LTC claim, you do get a life insurance benefit, but they are pricey. Many were initially designed to be single premium plans.
You need a new agent, obviously, since several other folks have put policies in place.
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

MrsBDG wrote: Sun Jun 20, 2021 12:51 pm I am told by my LTC expert that there are currently no policies available in WA other than hybrids, like Lincoln MoneyGuard, OneAmerica's AssetCare and Pacific Life Premier Care . It's quite possible there is a policy offered by a company which she does not handle. I am also told that the UL with the LTC rider will not work.

Given that WA says it has all of 2022 to verify these exemptions, I would advise anyone to plan to keep it until 2023 to be sure you are not audited before dropping it. But the hybrid plans are more expensive, they do have the advantage that if you do not file an LTC claim, you do get a life insurance benefit, but they are pricey. Many were initially designed to be single premium plans.
Your LTC expert does not seem to be much of an expert
MrsBDG
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by MrsBDG »

This is based on Mutual of Omaha and other companies closing to new applications last week.
BruDude
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

MrsBDG wrote: Sun Jun 20, 2021 1:58 pm This is based on Mutual of Omaha and other companies closing to new applications last week.
Only under age 40, unless they changed the rules yet again which is also possible. What was the expert’s reason that a UL with LTC policy won’t work? It meets the state definition.
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