Less Taxing IRS Forms for SeniorsMarch 5, 2020
Jessica Roshon becomes Certified in Elder LawAugust 5, 2021
By now, many people have received the Economic Impact Payment (stimulus check) from the IRS. This has raised two big questions for our clients: 1. Will this payment affect my SSI or Medicaid benefits? 2. What if the payment was received by a deceased person?
1. Will the stimulus check affect my SSI or Medicaid benefits?
The answer is “no” for up to 12 months after the month of receipt. The stimulus checks are being treated as income tax refunds. Under the Medicaid regulations, these funds are considered exempt for up to 12 months after the month of receipt. So long as those funds are identifiable in a bank account, they will not count toward your resource limit ($2,000 for a single individual). By the end of the 12th month after receipt, the funds must be spent down below the resource limit, or they will become countable and may impact your benefits.
2. What if a stimulus check was received by a deceased person?
The IRS just issued guidance regarding stimulus checks and deposits received by deceased individuals. If an individual died prior to receiving the stimulus payment, the payment must be returned.
If you have received a payment on behalf of a deceased individual, you should follow the steps to return the payment to the IRS. If the payment arrives via a hard check, there is a box on the front of the envelope to mark that the individual is deceased, and you can drop the envelope back in the mail. You can also visit the IRS Q&A website here, and see Questions 10 and 41 regarding returning payments received by a deceased individual.