Under the new law, which took effect last year, the top personal income tax rate was reduced and standard deduction amounts were increased, benefiting most taxpayers. But some taxpayers can no longer deduct medical expenses because itemized deductions are no longer allowed. As a result, some people eligible for Medicaid long-term care who are contributing nearly all of their income toward the cost of their care may now face a state tax liability - but may not have the funds to pay.
EOHHS has developed a process that essentially allows an eligible individual’s patient liability to decrease by the amount of the individual’s tax -- thus ensuring that someone in such circumstances who has insufficient resources will not be unduly harmed by having to pay two liabilities. For details, click here to read the state EOHHS memorandum.