Brad suffers from congestive heart failure and has been admitted to a nursing home where he is expected to spend the remainder of his life.His doctor has certified him as chronically ill.In 2017,Brad receives $320 per day from his life insurance policy for 100 days ($32,000)as accelerated death benefits.Brad's nursing home care costs $300 per day ($30,000 for the 100 days of care).Brad will be allowed to exclude

Question

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C)The taxpayer can exclude the greater of a maximum daily amount provided by law ($360 in 2017)or the actual cost of care.The daily amount paid from the insurance policy is lower than the legal maximum so the entire $32,000 is excluded.

Brad Suffers from Congestive Heart Failure and Has Been Admitted