Updated October 19, 2026. Quick answer: Box 3 of Form 1099-LTC shows whether the amount in box 1 or box 2 was paid on a per diem basis or as a reimbursement of actual expenses. It matters because the form says the amount you may exclude is limited when payments are per diem, and the revenue procedures state the dollar limit for each year. Form 8853 is where the limit is applied.
What box 3 reports
The policyholder copy describes the box this way: “Shows if the amount in box 1 or 2 was paid on a per diem basis or was reimbursement of actual long-term care expenses.”
On the form itself, box 3 is a pair of check marks, one for per diem and one for reimbursed amount. It is not a dollar box. The dollar amounts sit in boxes 1 and 2, which are explained in Form 1099-LTC boxes 1 and 2. The overview of every box is in the Form 1099-LTC boxes guide.
What per diem and reimbursed mean
The three documents define the terms in nearly the same words. The table puts them side by side.
| Term | What the text says |
|---|---|
| Per diem, on the payer’s instructions | “means payments made on any periodic basis without regard to actual expenses.” |
| Per diem, on the policyholder copy | “This means the payments were made on any periodic basis without regard to the actual expenses incurred during the period to which the payments relate.” |
| Per diem, in the Form 8853 instructions | “Per diem payments are payments of a fixed amount made on a periodic basis without regard to actual expenses incurred.” |
| Reimbursed | “means payments made for actual expenses incurred.” |
The pattern is the same each time. A per diem payment does not depend on the expenses you actually had. A reimbursed payment does. Which of the two a contract uses is a feature of the contract and how the payer pays under it, so the box is the payer’s report of that fact.
When the box may be blank
A blank box 3 is not always an error. The filer instructions say: “For accelerated death benefits, do not check a box if you made payments on behalf of a terminally ill person.” The policyholder copy says the same from the recipient’s side: “If the insured was terminally ill, this box may not be checked.”
If your form shows a terminally ill insured and no check mark in box 3, those two sentences are the reason to read first. Box 5 is where the payer may report the insured’s condition, which is the subject of Form 1099-LTC boxes 4 and 5.
Why per diem matters: the exclusion limit
The policyholder copy explains what is at stake. “Generally, amounts received under a qualified long-term care insurance contract are excluded from your income.” “However, if payments are made on a per diem basis, the amount you may exclude is limited.”
It then adds a point about more than one policyholder: “The per diem exclusion limit must be allocated among all policyholders who own qualified long-term care insurance contracts for the same insured.” That is the reason the form sends you to Form 8853: “See Pub. 525 and Form 8853 and its instructions for more information.”
The Form 8853 instructions connect the two forms directly. “Box 3 of Form 1099-LTC should indicate whether payments were per diem payments.” For the other kind of payment: “Box 3 of Form 1099-LTC should indicate if payments were made on a reimbursement basis.”
The stated per diem limit for 2025 and 2026
The per diem limit is an annual figure set in a revenue procedure. The two procedures this page uses each print it as item .62, periodic payments received under qualified long-term care insurance contracts, in a single sentence of running text.
| Calendar year | What the revenue procedure says |
|---|---|
| 2026 | “For calendar year 2026, the stated dollar amount of the per diem limitation under § 7702B(d)(4), regarding periodic payments received under a qualified long-term care insurance contract or periodic payments received under a life insurance contract that are treated as paid by reason of the death of a chronically ill individual, is $430.” |
| 2025 | “For calendar year 2025, the stated dollar amount of the per diem limitation under § 7702B(d)(4), regarding periodic payments” “treated as paid by reason of the death of a chronically ill individual, is $420.” |
Read the sentence closely. The limit is a stated dollar amount that applies to the periodic payments the sentence describes. The figures above are the ones the IRS published for those years; they are not an estimate of what any particular contract will pay or what any particular person may exclude. Look up the revenue procedure for the year on your form before relying on a figure.
How the limit is shared when more than one person is paid
The 2025 Form 8853 instructions describe how the limit is applied when several people received per diem payments for the same insured. The order is stated in prose: “The per diem limitation is allocated first to the insured to the extent of the total payments the insured received.” “If the insured files a joint return and the insured’s spouse is one of the policyholders, the per diem limitation is allocated first to them to the extent of the payments they both received.” “Any remaining limitation is allocated among the other policyholders pro rata based on the payments they received in 2025.”
The instructions also say who shares the result. “The statement showing the aggregate computation must be attached to the Form 8853 for each person who received a payment.” If you are one of several people named on the insured’s payments, that is a sign to read the Form 8853 instructions rather than rely on a summary. Background on how long-term care coverage pays is on the hybrid versus traditional long-term care insurance page, and the return the form feeds is the Schedule 1 (Form 1040) page.
Edition and box numbers
This page reads Form 1099-LTC (Rev. April 2025) and the Instructions for Form 1099-LTC (Rev. April 2025), the current files irs.gov served on 2026-10-19. The filer instructions carry this line: “Use these instructions for tax year 2025 and subsequent years until a superseding revision is issued.” The Form 8853 passages come from the 2025 instructions, and the dollar sentences come from Revenue Procedure 2025-32 and Revenue Procedure 2024-40. Check the year and edition printed on the form you received before relying on any box description here, because box numbers can change between editions.
Common mistakes
- Reading a per diem check mark as a sign that the whole amount is taxable. The form says “if payments are made on a per diem basis, the amount you may exclude is limited.” That is a limit on the exclusion, and Form 8853 is where it is worked out.
- Looking only at your own form when others are paid for the same insured. The form says “The per diem exclusion limit must be allocated among all policyholders who own qualified long-term care insurance contracts for the same insured.”
- Treating an empty box 3 as a payer mistake without checking the insured’s condition. The instructions say “If the insured was terminally ill, this box may not be checked.”
Related: hybrid versus traditional long-term care insurance, and Schedule 1 (Form 1040).
Sources
- Form 1099-LTC, Long-Term Care and Accelerated Death Benefits (Rev. April 2025), with Instructions for Policyholder and Insured: https://www.irs.gov/pub/irs-pdf/f1099ltc.pdf
- Instructions for Form 1099-LTC (Rev. April 2025): https://www.irs.gov/pub/irs-pdf/i1099ltc.pdf
- 2025 Instructions for Form 8853, Archer MSAs and Long-Term Care Insurance Contracts: https://www.irs.gov/pub/irs-pdf/i8853.pdf
- Revenue Procedure 2025-32 (2026 inflation adjustments): https://www.irs.gov/pub/irs-drop/rp-25-32.pdf
- Revenue Procedure 2024-40 (2025 inflation adjustments): https://www.irs.gov/pub/irs-drop/rp-24-40.pdf
- IRS: About Form 1099-LTC: https://www.irs.gov/forms-pubs/about-form-1099-ltc
Read from the IRS documents linked above on October 19, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.