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She is paying 30% of her SS, about $350 for rent and $60 for utilities, we have calculated this based on what low-income housing might cost her.

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No, it won’t complicate Medicaid as they expect her to have normal living expenses. It is very good idea to have a rental agreement or contract stating what she’s paying for though just in case any issues arise with Medicaid.
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Do a share of costs and not a rental agreement. A rental agreement makes the money she pays towards her share of costs income to you. She is paying her living expenses and that is different than renting.
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