My Mom has Medium Dementia/Memory Loss, she has a small amount of savings, once the savings is used-up and the IRA money is used, does she still have to pay taxes on it? My name is on the Home title with her name, after the IRA runs out, will the state (NM) force me to sell my House to pay for her care before Medicaid kicks in?
However, the tax effect will be lessened because at least part of her expenses at the assisted living facility will be deductable as a medical expense. She will need to itemize her deductions to take advantage of this.
In my area there are volunteers who provide tax filing help to seniors during tax season. Maybe you can find someone to help you at least the first year.
BTW, are your monies placed in a trust? that would be the deciding factor in the house situation.
Change title, ownership. Knowing that we are ALL going to die, sometime..I often wonder why everyone doesn't do this. ?? I am open to suggestions.
IRA withdrawals create a 1099-R. They'll sent it to you in January. Enter the amount on Line 16A. Carry over the taxable amount on Line 16 B. Software will do the calculations.