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Your problem is dad has Dementia and may not be able to sign a contract you need to say he agrees to pay you a certain amount of rent a month. And acceptable, that depends on what his monthly income is. Enough money needs to be left for his care needs. I would consult with an elder lawyer versed in medicaid law. Or call Social services to talk to a Medicaid caseworker.
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Reply to JoAnn29
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See an elder law attorney.
There is too much you don't know and you need the facts.
Just to start with, asking for RENTAL means you have to pay taxes but asking for shared living expenses means you do NOT?
Were you aware of that. I would be not. THat's why you seek the advice of an expert.
An Elder Law Attorney can give you suggestions and options and it is WELL WORTH the money.
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Reply to AlvaDeer
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My Mom lives in the house next door, which we now own. Four years ago she signed the first rental invoice. She did not have a medical diagnosis of dementia then. It is itemized and we don't make any profit on her renting it -- she just covers the insurance, property taxes, etc. Yours is a question for an accountant and/or an elder law attorney because your Dad lives IN your house.
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Reply to Geaton777
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DO not navigate this without an attorney. Honestly, a good attorney will walk you through the Medicaid nightmare. There are so many rules and twists and turns...but it can be successfully done. If you live 30 miles west of Philadelphia I have a good recommendation. She's helped us tremendously.
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Reply to LisaMarieA
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Agree with the recommendations to get immediate advice from an elder care attorney lichened in your state! Each state law is slightly different. Further, NOT Knowing what is or is NOT legally permitted in your state is NOT a defense after the fact. Once done, there are NO do overs!

And if at a later date, he might need Medicaid covered long term nursing home coverage; understanding with proper legal advice what to do now (or not do now) and in light of downstream needs (such as long term nursing home Medicaid coverage) is critical.

There is a lot of planning, paperwork to gather/keep report for you both; including potentially treating the "rent" as reportable income on your state and federal taxes. This is complicated and you really need legal advice.

Good luck with this.
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Reply to Sohenc
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You should see an elder law attorney.
When you take in an elder it is CRUCIAL to have a care contract in place or it will look like gifting from your father to you. And it is crucial that things not be designated as RENT as that has tax consequences for you whereas "shared living costs" which is the same amount, does not have tax consequences for you almost always. It is important you have a written and signed contract and a good paper trail for all expenditure, good files and record keeping.

These things can't be left to opinions of folks not trained in these questions.
Do see an elder law attorney for best advice and the most protection. Like insurance there is a cost to these, but the cost of being wrong is catastrophic.

I sure wish you good luck.
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Reply to AlvaDeer
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If dad pays you rent - you will need to claim that as income and a part of your house as rental. Also, the part that is rental has to be up to rental code, you will have to check your local city, county and state laws. You will need receipts.
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Reply to Ohwow323
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AlvaDeer May 14, 2024
Yes. this money should be taken as "shared living expenses". And records kept. This is not then taxable.
RealyReal is the one that taught me that one. But there is so much more to know. A care contract should be done with an attorney imho.
Our OP here is the one who knows what care she provides, what care is needed, what home she is providing, what food and etc and what her own expenses are in terms of care to go to appointments, gas costs, utilities and etc. So our OP and her attorney should discuss the options, given her elder's ability to pay from his assets.
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Jenr130: As Medicaid laws are challenging, you'd do yourself a favor by retaining an elder law attorney.
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Reply to Llamalover47
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It may depend on the state and area in which you reside. In Washington, my adult daughter, who receives Medicare and Medicaid, pays me $700/month for room and board. This is an amount that others, in my situation, say that they charge their disabled adult children. I imagine that Medicaid adults could pay that amount to their caregiver children, also.

Please note, I am the fiduciary for my daughter and I keep receipts for all monies spent. You would want to do the same record-keeping for your dad.
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Reply to SuzySez
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