Hello everyone. I am starting to notice a recurring theme in the contacts that I am having with people about stimulus checks recently, and it goes something like this: How can I keep my stimulus check from being taken?

So, the details may change from one taxpayer to the next, but it’s clear to me that many of you are worried about your stimulus checks being seized. The CARES Act made it clear that the only reason a stimulus check might be offset (i.e., seized) is for past-due child support support.

Your stimulus check may not be seized by the government for any other debt, including back taxes.

But, once the stimulus check hits a your bank account, there is no longer protection from seizure. One such seizure that is particularly appalling is those from nursing homes and assisted living facilities.

The Federal Trade Commission (FTC) has issued an alert to consumers (which you can find here) to be on the lookout for nursing homes and assisted living facilities that are requiring residents, who are on Medicaid, to sign their stimulus checks over to the facilities. To be specific, nursing home and assisted living facilities have been accused of pressuring residents to sign the checks over, claiming that stimulus checks count as “resources” under the rules of federal benefit programs that must be used to pay for services.

But that is so not true. Keep in mind, stimulus checks are really advanced tax credits. (See my prior article regarding stimulus checks here).

And, Lois Greisman, the Elder Justice Coordinator for the FTC, reminds taxpayers that tax credits do not count as “resources” for federal benefits programs like Medicaid. So that means that nursing homes and assisted living facilities can’t take that money from residents just because they’re on Medicaid. And if you need more legalese, Greisman references this link, which takes you to the Congressional Summary for the CARES Act which notes that tax credits are not countable as resources for federal government programs (see page 3).

Ms. Greisman advises that if a nursing home or assisted living facility has already taken your stimulus check, you should get in touch with your state attorney general and ask them to help you get it back. Then, she says, tell the FTC. 

You can also talk with the nursing home or assisted living facility directly, but let’s be real: it can be scary to ask for your money back when you don’t feel like you’re in a position of power. If you feel like you need some muscle on your side, definitely reach out to your state attorney general.

If you’re not sure what happened to a check belonging to a loved one who lives in a nursing facility, talk with them. SOON! I know this is happening because I am hearing from a lot of you wondering how to handle this situation. Now you have your answer.

You can find more helpful information from the National Center on Law & Elder Rights for people who live in nursing homes or assisted living facilities.

EVERYONE PLEASE, PLEASE, PLEASE STAY WELL and STAY HEALTHY (Even though the country is, as of now, re-opening in phases)!

BRUCE

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Bruce – Your Host at The Tax Nook

Our Firm’s Website: SolidTaxSolutions.com