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My mother-in-law passed away in November. Her tax return indicates that she is due a small ($180) state tax refund. Since she was on Medicaid for nursing home care I believe this amount is supposed to go back to the state, but there is no place to indicate that on the tax return. It allows my husband to claim it on her behalf. I am wondering if the state will automatically know and intercept it, or if they will send a letter with a bill later?


She had very little of an estate and probate was not needed. Her funeral trust leftovers were sent to the state automatically. Her nursing home resident account as well.


There was a small bank balance in another state that was jointly owned by a friend of hers. He closed it after her death. I think Medicaid could claim that money but as far as my husband and I know, they have not pursued it.


We have possession of her low-value vehicle which currently is still in her name. Our state has a simple form transferring ownership to an heir for a fee. Do we transfer it? Contact Medicaid about the vehicle? Although it is not expensive we don't have the cash to pay out the value amount. The idea of dealing with selling it on behalf of the state is annoying. I don't suppose Medicaid would come get the actual vehicle instead? Heh. We could always donate it to a charity for $0 I suppose.

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I don't understand all the anger at Medicaid recovery, they stepped in when the recipient was in dire need with the understanding that they would get as much money back as possible.

I think that selling the car for the state beats the h3ll out of having to pay for the care your MIL received or having to move her in to your home and be her caregiver.

Call the contact at Medicaid that worked with your LO and ask them how and what to do.
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Reply to Isthisrealyreal
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Jbean1 Mar 11, 2019
I think you misunderstood the purpose of my post. I have no anger about Medicaid recovery. We expected it from the very start.

I'm asking about doing things properly with the bits and pieces left over so as to not inadvertently cause complications. I thought people here may have personal experience to share

I am annoyed about the vehicle, not because of Medicaid specifically but because we have to deal with it at all. There is a personal backstory that isn't relevant to the topic. It is currently frozen to the pavement of our garage slab so it's not moving until spring in any case.
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When saying Resident account do you mean her Personal needs account where she gets to keep a small amount of her SS for personal needs? If so, this does not go back to Medicaid. I was able to prove that I was Executor and her PNA balance was sent to the estate. I have been using it to pay for some upkeep on her house. I really don't think Medicaid is worried about a small refund. You could call. But she was allowed 2k in her account, does this keep her under?
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worriedinCali Mar 10, 2019
Actually it does go back to Medicaid. We must remember that MERP varies from state to state. The OP has posted below that she is in wisconsin and they have a very aggressive MERP. All cash and liquid assets go to Medicaid.
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Jbean1, everything income tax wise has become so complex since the recent tax reform. I would recommend going to a CPA or tax preparer to do the income tax stuff.

My Dad had passed in 2016 and his estate was in Probate for almost 2 years, so during those 2 years my Dad's estate had to pay income taxes.... [sigh]. I have the CPA on speed dial.
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Reply to freqflyer
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Medicaid cannot claim the money in the joint bank account. Legally that money became the co-owners when she died. That account is except from MERP. You can transfer the car to your name. Medicaid doesn’t come after vehicles. Since there is no estate in probate, there is nothing for them to go after.
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Jbean1 Mar 10, 2019
In the state of Wisconsin, Medicaid recovers from non-probate assets as of 2014. The list of recoverable assets includes jointly-owned bank accounts and vehicles. For vehicles, it specifies either the money collected by selling the vehicle, or if the vehicle is kept up to $3000 (if I remember correctly) paid by the heir.

One thing I was surprised about is that they also recover from life insurance regardless of beneficiary. Wow. MIL didn't have an active policy so we didn't have to deal with that one.
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