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But perhaps, I should leave some TIRA money behind for funding long term care costs which I will most likely need at some point. Are there any special criteria that must be met in order to use TIRA dollars tax free for this purpose? I suppose there are.
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Well, as described, it's not completely "tax-free", to the extent that:
* You have to pick it up in gross income, so it's in your AGI for all purposes, including any applicable phaseouts.
* The offsetting LTC payments are a medical expense, subject to the 10% floor.
* If it makes your AGI high enough, you could be subject to the additional 3.8% Medicare tax on investment income

And all of the above were true in the case of my father, who had a lot of money (and a very good LTC insurance policy that you can't buy today) and who spent his last 9 years in a nursing home after suffering a stroke. He required additional personal nursing care, over and above that provided by the nursing home, which came to about $210,000 his last year.

My sisters all thought it was worth it. I had the health care and financial POA, and had the final vote, but they lived closer to him than I did. So I always deferred to their judgment.

Bill
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