Instructions For Form 1099-Ltc - 2016
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1
22016
Department of the Treasury
Internal Revenue Service
Instructions for Form
1099-LTC
Long-Term Care and Accelerated Death Benefits
Future Developments
insurance companies, governmental units, and viatical
settlement providers.
For the latest information about developments related to
Form 1099-LTC and its instructions, such as legislation
Viatical Settlement Providers
enacted after they were published, go to
form1099ltc.
A viatical settlement provider is any person who:
1. Is regularly engaged in the trade or business of
What's New
purchasing or taking assignments of life insurance contracts
on the lives of terminally or chronically ill individuals, and
Online fillable form. Due to the very low volume of paper
Forms 1099-LTC received and processed by the IRS each
2. Is licensed in the state where the insured lives. If
year, this form has been converted to an online fillable
licensing is not required in the state, the provider must meet
format. You may fill out the form, found online at
other requirements (including those below) depending on
form1099ltc, and send Copy B to the recipient. For filing with
whether the insured is terminally or chronically ill.
the IRS, follow your usual procedures for filing electronically if
a. If the insured is terminally ill, the provider must meet
you are filing 250 or more forms. If you are filing this form on
the requirements of sections 8 and 9 of the Viatical
paper due to a low volume of recipients, for this form
Settlements Model Act of the National Association of
only, you may send in the black and white Copy A with a
Insurance Commissioners (NAIC), relating to disclosure and
Form 1096 that you print from the IRS website.
general rules. The provider must also meet the requirements
Reminder
of the Model Regulations of the NAIC for evaluating the
reasonableness of amounts paid in viatical settlement
In addition to these specific instructions, you should also use
transactions with terminally ill individuals.
the 2016 General Instructions for Certain Information
b. If the insured is chronically ill, the provider must meet
Returns. Those general instructions include information
requirements similar to those of sections 8 and 9 of the
about the following topics.
Viatical Settlements Model Act of the NAIC and must also
Who must file (nominee/middleman).
meet any standards of the NAIC for evaluating the
When and where to file.
reasonableness of amounts paid in viatical settlement
Electronic reporting requirement.
transactions with chronically ill individuals.
Corrected and void returns.
However, if a state enacts a licensing requirement
Statements to recipients.
but does not permit viatical settlement providers to
Taxpayer identification numbers.
!
engage in business until the licenses are granted,
Backup withholding.
CAUTION
the provider will not be considered as licensed under section
Penalties.
101(g)(2)(B)(i)(I). See Rev. Rul. 2002-82, which is on
Other general topics.
page 978 of Internal Revenue Bulletin 2002-51 at
pub/irs-irbs/irb02-51.pdf.
You can get the general instructions from
form1099ltc.
Qualified Long-Term Care Insurance Contract
Specific Instructions
A contract issued after 1996 is a qualified long-term care
File Form 1099-LTC if you pay any long-term care benefits.
insurance contract if it meets the requirements of section
7702B, including the requirement that the insured must be a
Long-Term Care Benefits
chronically ill individual (see Chronically Ill Individual, later). A
Long-term care benefits means:
contract issued before 1997 generally is treated as a
qualified long-term care insurance contract if it met state law
1. Any payments made under a product that is
requirements for long-term care insurance contracts and it
advertised, marketed, or offered as long-term care insurance
has not been materially changed.
(whether qualified or not), and
2. Accelerated death benefits (excludable in whole or in
Accelerated Death Benefits
part from gross income under section 101(g)) paid under a
life insurance contract or paid by a viatical settlement
An accelerated death benefit is any amount paid under a life
provider.
insurance contract for an insured individual who is terminally
or chronically ill. It also includes any amount paid by a viatical
settlement provider for the sale or assignment of a death
Who Must File
benefit under a life insurance contract for a chronically or
File Form 1099-LTC if you paid any long-term care benefits,
terminally ill individual.
including accelerated death benefits. Payers include
Oct 23, 2015
Cat. No. 27981Y
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