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Internal Revenue Code · 26 U.S.C.

§ 4980C. Requirements for issuers of qualified long-term care insurance contracts

In force Text current through Public Law 119-121 (October 9, 2026) release point 119-121

Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).

Cite as 26 U.S.C. § 4980C

At a glance

Read from the text, the source credit and the official notes. Not part of the law.

Status
In force
Added
August 21, 1996 by Pub. L. 104–191
Length
6 subsections · 704 words · about 3 min to read
Defines
1 term
Cross-references
cites 5; cited by 2 Code sections and 1 other regulation
(a) General rule

There is hereby imposed on any person failing to meet the requirements of subsection (c) or (d) a tax in the amount determined under subsection (b).

(b) Amount
(1) In general

The amount of the tax imposed by subsection (a) shall be $100 per insured for each day any requirement of subsection (c) or (d) is not met with respect to each qualified long-term care insurance contract.

(2) Waiver

In the case of a failure which is due to reasonable cause and not to willful neglect, the Secretary may waive part or all of the tax imposed by subsection (a) to the extent that payment of the tax would be excessive relative to the failure involved.

(c) Responsibilities The requirements of this subsection are as follows:
(1) Requirements of model provisions
(A) Model regulation The following requirements of the model regulation must be met:
(i) Section 13 (relating to application forms and replacement coverage).
(ii) Section 14 (relating to reporting requirements), except that the issuer shall also report at least annually the number of claims denied during the reporting period for each class of business (expressed as a percentage of claims denied), other than claims denied for failure to meet the waiting period or because of any applicable preexisting condition.
(iii) Section 20 (relating to filing requirements for marketing).
(iv) Section 21 (relating to standards for marketing), including inaccurate completion of medical histories, other than sections 21C(1) and 21C(6) thereof, except that—
(I) in addition to such requirements, no person shall, in selling or offering to sell a qualified long-term care insurance contract, misrepresent a material fact; and
(II) no such requirements shall include a requirement to inquire or identify whether a prospective applicant or enrollee for long-term care insurance has accident and sickness insurance.
(v) Section 22 (relating to appropriateness of recommended purchase).
(vi) Section 24 (relating to standard format outline of coverage).
(vii) Section 25 (relating to requirement to deliver shopper’s guide).
(B) Model Act The following requirements of the model Act must be met:
(i) Section 6F (relating to right to return), except that such section shall also apply to denials of applications and any refund shall be made within 30 days of the return or denial.
(ii) Section 6G (relating to outline of coverage).
(iii) Section 6H (relating to requirements for certificates under group plans).
(iv) Section 6I (relating to policy summary).
(v) Section 6J (relating to monthly reports on accelerated death benefits).
(vi) Section 7 (relating to incontestability period).
(C) Definitions

For purposes of this paragraph, the terms “model regulation” and “model Act” have the meanings given such terms by section 7702B(g)(2)(B).

(2) Delivery of policy

If an application for a qualified long-term care insurance contract (or for a certificate under such a contract for a group) is approved, the issuer shall deliver to the applicant (or policyholder or certificateholder) the contract (or certificate) of insurance not later than 30 days after the date of the approval.

(3) Information on denials of claims If a claim under a qualified long-term care insurance contract is denied, the issuer shall, within 60 days of the date of a written request by the policyholder or certificateholder (or representative)—
(A) provide a written explanation of the reasons for the denial, and
(B) make available all information directly relating to such denial.
(d) Disclosure

The requirements of this subsection are met if the issuer of a long-term care insurance policy discloses in such policy and in the outline of coverage required under subsection (c)(1)(B)(ii) that the policy is intended to be a qualified long-term care insurance contract under section 7702B(b).

(e) Qualified long-term care insurance contract defined

For purposes of this section, the term “qualified long-term care insurance contract” has the meaning given such term by section 7702B.

(f) Coordination with State requirements

If a State imposes any requirement which is more stringent than the analogous requirement imposed by this section or section 7702B(g), the requirement imposed by this section or section 7702B(g) shall be treated as met if the more stringent State requirement is met.

(Added Pub. L. 104–191, title III, § 326(a), Aug. 21, 1996, 110 Stat. 2065.)

Terms defined here

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Cross-references

Computed from the citations in the text of Title 26 and 26 CFR.

This section cites 5 other sections

Cited by 2 Code sections

Cited in 1 regulation not issued under it

Amendment history

From the source credit and the official notes, newest first.

  1. Added by Pub. L. 104–191

Where it sits in the Code

  1. Subtitle D Miscellaneous Excise Taxes
  2. Chapter 43 QUALIFIED PENSION, ETC., PLANS

Nearby sections

Official notes

Show the Law Revision Counsel's notes (amendments, effective dates)

Statutory Notes and Related Subsidiaries

Effective Date

Pub. L. 104–191, title III, § 327, Aug. 21, 1996, 110 Stat. 2066, provided that:

“(a) In General.— The provisions of, and amendments made by, this part [part II (§§ 325–327) of subtitle C of title III of Pub. L. 104–191, enacting this section and amending section 7702B of this title] shall apply to contracts issued after December 31, 1996. The provisions of section 321(f) [set out as an Effective Date note under section 7702B of this title] (relating to transition rule) shall apply to such contracts.
“(b) Issuers.— The amendments made by section 326 [enacting this section] shall apply to actions taken after December 31, 1996.”