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Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 482
Experience:  Former IRS Revenue Agent
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My mother is on medicaid and in a nursing home in Michigan.

Customer Question

my mother is on medicaid and in a nursing home in Michigan. Can she keep her $1100 income tax refund to pay property taxes
JA: The accountant will know how to help. Please tell me more, so we can help you best.
Customer: what else do you need to know
JA: Is there anything else the accountant should be aware of?
Customer: she pays her whole income less her blue cross to the nursing home every month. she owns her home. i am her son and i have been paying her property taxes
Submitted: 6 months ago.
Category: Tax
Expert:  Dr. Fiona Chen replied 6 months ago.

Dear Customer,

You need to consult with an attorney. Apparently, she is temporarily in the nursing home. That is why she can still keep the house. However, if her whole income and social security is completely paid over to the Medicaid and no money is allowed for the property tax, it is likely that the Medicaid does not know that she has this house.

Also, if she has income tax withheld, hopefully, she is likely to be on pension and not 401(k) type of retirement. 1,100 refund is a relatively large amount to be withheld. I am trying to think how much is her income.

For property tax itself, you may be able to apply for reverse property tax. That is, for seniors with low income, they can apply for not paying property tax until they leave the house and use the proceeds for the sale to pay the property tax. Usually, there is a percentage of interest each year accumulated.

But don't apply for this real estate hold yet. Don't contact your county government yet.

Consult with an attorney first and know all the aspects of the issues first. Consult with a medicaid planning attorney.

Your mother and you may face the possibility to sell the house to pay the whole proceeds to Medicaid if your steps are done correctly.

Please feel free to follow up.

Regards,

Fiona

Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP

Expert:  Dr. Fiona Chen replied 6 months ago.

p.s. Correction: your steps are NOT done correctly.