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Does a Nursing Home Resident Have to Pay Taxes?

  • August 27th, 2013
Q
My father-in-law is in a nursing home in our small community. Of course he gets social security and a pension. He has had his former employer take out taxes (federal) since his retirement. The nursing home gets all his money (around $2,430), and Medicaid picks up the balance. Medicaid is now telling my husband, that his dad will have to not have the money taken out for taxes, because they want it. We have asked them why, and they tell us his dad doesn't have to pay taxes because he is in a nursing home. Well the federal government is telling us he does have to pay taxes. What can we do?
A

I would be very surprised if your father-in-law still must pay taxes now that he is in a nursing home since his contribution of his income to the nursing home should be treated as a deductible health care cost. So there should be no reason to continue to have the taxes deducted from the pension. The Medicaid agency accordingly included all of the income in determining what must be paid to the nursing home. To check on this you could consult with a local accountant or elder law attorney.

Local Elder Law Attorneys in Ashburn, VA

Jean Ball

Hale Ball Carlson Baumgartner Murphy PLC
Fairfax, VA

William Fralin

The Estate Planning & Elder Law Firm PC
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Loretta Williams

Hale Ball Carlson Baumgartner Murphy PLC
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Last Modified: 08/27/2013

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