What to do with a tax refund?

Medicaid regulations in your state include "non-countable assets" and services that you can acquire for your mother using her tax refund.

You may also be compensated for your work, if you have a Caregiver Contract with your mother.

Talk with an Elder Law Attorney for ideas on how to help your mother. The legal work is another service that can be paid with the refund that would otherwise become "excess assets" if you keep it for more than 1 month.

You need to spend it on her. Hopefully its not a lot.

Next year I would talk to a CPA or your tax preparer if a good one. (not H&R block)Since Mom is now on Medicaid and her income was such to qualify her, she may not need to file for income taxes federal or state. My MIL and Mom received letters d from the IRS that their income was not enough to file. Most of their income was SS which is not taxable when under the limit set. I questioned my tax person about Filing Moms aft her death. She felt that since she had not filed in years, the little she may receive wouldn't be worth it with having to pay to have it done too.

Had same issue. Mother already on Medicaid and in nursing home. Got tax refund. DCF (they manage Medicaid in Florida) told me that the federal tax refund is not "income" but it would be counted as an "asset" if it stayed in her bank account and her assets exceeded the $2000 maximum at month end. They said NO....it does not have to be paid to nursing home. Think about it, economically: the refund is just giving you back money you never owed or had to pay in the first place......but you paid it. Now you have it back. DCF told me to do whatever you want with it; just get it out of her account at month end. As far as using it to pay off credit cards, please speak with a lawyer.

Thank you all. I’ll see if her case worker will answer the question. I’ve asked, but still no reply. Thanks again.