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Independent Contractor Services - the 1099 is Your Friend

6/14/2017

Caveat right up front: I'm not a CPA and I don't give tax advice. But this is a recurring issue both with our vendors and for some of our clients, so I thought it might be for you, too.

If you're an independent contractor, that means the companies and people for whom you provide services don't withhold employment taxes from your check. "Yay! More for me!", I hear you cry. Not so fast, Mr/Ms Entrepreneur! You see, if you receive more than about $600 per year from anybody for services performed, they have to issue you a Form 1099. They also file that 1099 with their own taxes. That means the IRS will know you got paid, and that worthy agency will want to know if you paid taxes on that income.

It's not too late this year to fill out a Form W-9 and give it to each entity for whom you provide services, and then put away enough from the rest of your income from that entity to cover your tax bracket. That way, when that 1099 comes in next January or so, you won't be unpleasantly surprised by the the amount you'll owe the IRS on April 15th. After all, borrowing money on your credit card to pay your taxes just stinks.

As noted (and as always), the above is not legal or tax advice, and if you have questions or concerns, you should contact an attorney and/or a CPA to discuss your particular situation.

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Medicaid Liens on Texas Homesteads - There Aren't Any

6/1/2017

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We handle a lot of elder law cases, and we often have clients worry that "Medicaid will put a lien on my house/take my house/sell my house" in order to recoup amounts paid out by Medicaid for assistance with assisted living or nursing home services.

Here's the short answer: the Texas Medicaid Estate Recovery Program, or "MERP" IS NOT a lien program. The term, "Medicaid lien" doesn't apply in Texas. A claim under MERP is made against the estate of the deceased, not against any specific property, so your house will NOT have a lien placed against it. The MERP claim doesn't give MERP the right to foreclose on a particular asset, nor is there any power to force repayment from any specified asset. In fact, a lien is a "high priority" claim against a probate estate, but a MERP claim is a low priority claim.

Does this mean Mom and Dad can keep their house AND get Medicaid services? Depends (I know, I know - typical!). There are two tests for benefits: the assets test and the income test. The process is a bit complicated, which is why anybody seeking Medicaid benefits needs to discuss options with an attorney who practices in this area. Assisted care or nursing home social workers are a good resource, but they don't always have the latest information.

As always, the above is general legal information based on Texas law and is not legal advice. If you have a concern about benefits, we recommend you contact an attorney to discuss your particular case.

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Independent Contractor Services - the 1099 is Your Friend

Medicaid Liens on Texas Homesteads - There Aren't Any

Dana Jacobson

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