My father is in a nursing home, and I notice quite a few people there who are physically or mentally incapable of simple tasks and who have no family. Many people in the home have all their income (typically pension and/or Social Security) sent directly to the nursing home; 100% of their income goes to the home. My question: do these people pay income tax? If so, who fills out their tax forms?
I’m not an accountant, but have been filing my own and family’s tax returns for over 30 years. If the little bit of income these people have is virtually all going for medical care, that alone is going to cause their deductions to be high enough to require no tax payment, even if they had to file There are also tax credits for the elderly and the disabled.
My MIL lives on Social Security and a small pension. She has not been required to file a tax return for many, many years.
Basically, the IRS doesn’t really care if you file a return or not, as long as you don’t owe them money. An elderly and/or disabled person with a small income, most of which is being spent on medical care is very unlikely to owe a dime.
Again, I’m not an accountant or attorney, this is just my experience and personal observation, so don’t take this as legal advice, please.
My dad volunteers at his local senior center to do people’s taxes when they need help. It’s some IRS-sponsored program, as they give him a dedicated computer for it every year. He helps a lot of people file (and sometimes they bring him brownies, which is cute) but I think probably only those who can get there. I don’t know if he goes to nursing homes and helps those folk.
In general, SS all by itself isn’t taxable- (at $25,000 of “provisional income” for a single person is when you have to start calculating* if* it is taxable). Many dudes on a small pension and SS are not required to file at all, as** MLS** said.