What does this mean for annuities?

Cash value withdrawals from eligible annuity contracts for qualifying long-term care (LTC) expenses or qualifying long-term care insurance premiums are no longer taxable income.

Can regular annuity withdrawals for LTC expenses be treated as tax-free distributions?

An annuity policy must include language which makes it qualifying. This would preclude a “regular annuity” (an annuity with standard free withdrawal) from receiving the benefits of the PPA.

How will long-term care benefits be reported?

Qualifying LTC and LTC insurance premiums paid from annuity values along with LTC benefits paid from riders will be reported at year-end on Form 1099-LTC.