Income tax for nursing home resident on Medicaid?
January 19, 2011 1:16 PM Subscribe
Is a person exempt from income tax if he is living in a nursing home and on Medicaid?
posted by leticia to Law & Government (13 answers total)
My father-in-law went into a nursing home in the summer of 2010, and after spending down his resources, qualified for Medicaid, which pays for the care now.
Since this all just happened a few months ago, we're pretty new to this whole scenario - Medicare, Medicaid, nursing home, etc. We had nothing to do with his financial affairs before he became ill and had to go into the nursing home, either, so it's new for us on that front, too. It's all pretty confusing, so any guidance we can get would be appreciated!
He receives a pension from his previous job. His social security income goes directly to the nursing home, but the pension income does not. His pension income goes by direct deposit into his bank account, and my husband writes a check on those funds to the nursing home. (Hubby has power of attorney.) Everything is calculated out so that all of his pension income is supposed to the nursing home.
Now, in January, Hubby discovered the pension checks were smaller than expected. Turns out the taxes have gone up. Hubby contacted the nursing home (which is still expecting the same size check from us), who told him that as a person on Medicaid, Father-in-Law is exempt from paying taxes, and we need to talk to the pension folks to get them to stop withholding taxes.
So my basic question is, is this correct? Is he exempt from having taxes withheld off his pension check?