Elder Law Answers
Can a Medicaid Recipient Keep Rental Properties?
My mother-in-law has recently been diagnosed with Alzheimer's disease. She owns two rental properties that bring in a good...
Read moreCan a Medicaid Recipient's Rental Income Be Used to Pay Mortgage or Must It Go to the Nursing Home?
- December 7th, 2015
Q
My great-aunt recently entered a nursing home due to severe dementia. She owns her home, and I am on the deed as co-owner with right of survivorship. I have been handling her mortgage payments. The mortgage is almost equal to what the house is worth. I want to rent the house to another family member to cover the mortgage, taxes, and operating costs. The nursing home believes that the rent would be income that they are entitled to. I say it is not income as long as it is paying the loans and taxes. Is this true?
A
You are probably right, but it depends on your state Medicaid agency. In general, the net income from the house must be paid to the nursing home (or half of the net income in your case, since you are a co-owner). You should be able deduct the expenses from the gross income to determine the net income. But check with your state Medicaid agency to be certain.
For more information on how Medicaid treats income, click here.