The Internal Revenue Service is increasing the amount taxpayers may deduct from their tax returns this year when buying long-term-care insurance or paying monthly premiums.

“The increase is a positive sign that the government recognizes it needs to encourage people to do long-term planning for themselves,” said Jesse Slome, executive director of the American Association for Long Term Care Insurance in Los Angeles.

Monthly premiums for long-term-care insurance policies for those 65 years old or younger may be deducted to the extent that they, along with other unreimbursed medical expenses, exceed 10% of the insured person’s adjusted gross income.

“Long-term-care insurance is considered a health-insurance-related expense, and as a result must be itemized and meet certain thresholds,” Slome said. Premiums are what the policyholder pays the insurance company to keep the policy in force and may be deductible for the taxpayer, his or her spouse or other dependents.

The increase in deductible limits is the latest benefit that long-term-care insurance offers clients of financial advisors.

“The income of retirees is low but their medical expenses become higher, and that’s when the deductible comes into play,” Slome said. “That’s something that financial advisors rarely talk to individuals about.”

The new, higher deductible limits depend on the age of the taxpayer at the end of 2016, and any premium amount above the new limit is not considered to be a medical expense.

For eligible long-term-care premiums that may be included under medical care expenses—according to Section 213(d)(10) of the Internal Revenue Code—the 2016 deductible limit is $1,460 for people who are at least 50 years old but not more than 60, and $3,900 for those older than 60 but not over 70. “Rarely do insurers approve long-term-care insurance for those 75 and older,” Slome said.

For individuals 40 years old and younger who are eligible, the limit in 2016 is $390, up from $380 this year, which amounts to a 2.6% increase from the previous year.

“I fully expected there to be no increase in the deductible limit because there’s been no increase in Social Security payouts due to inflation being low,” Slome said. “It’s surprising that the IRS has granted an increase in long-term-care deductible limits for 2016.”