Is Employer Paid Long Term Care Insurance Taxable? 
Long term care insurance provides benefits that extend beyond those paid under Medicare and most private insurance . The benefit is normally paid in months and at a predetermined level . The extremely helpful insurance is sometimes offered as a benefit by employers . If the employer pays the premium , the employer is able to deduct that cost from his own taxes as a reasonable business expense -LRB- employee benefit . -RRB- The employee does not incur any income tax liability as a result . When a benefit is received it comes to the employee free of income tax . There arent any non-discrimination rules that require an employer cover all of the employees . Executives should consider accepting an Employer Paid Long Term Care Insurance policy in exchange for a salary reduction . It is a win situation for the employer and also a win situation for the highly valued employee . This benefit can be combined with a more comprehensive medical health care plan that includes additional benefits such as a comprehensive annual physical examination . This benefit can also be combined with a supplemental disability benefits program for valuable employees . Employer paid long-term care insurance is often combined with retiree medical insurance . Among employers the trend is to reduce or eliminate retiree medical benefits to the rank and file employees . For highly compensated employee there is a trend towards cost sharing arrangements for medical expenses after retirement . 