Can I use my 401(k) to pay for long-term care insurance without a penalty?

Yes, if your plan offers this feature. Under SECURE 2.0, eligible retirement plans may permit penalty-free distributions to cover certified LTC insurance premiums up to $2,600 in 2026 (indexed annually) or 10% of your vested account balance, or actual premiums paid, whichever is less. However, the distribution is still taxable as ordinary income.