March 10, 2015
New York Public Health Law §2807-d(2)(b) imposes an assessment on New York residential health care facilities of six percent (6%) of the receipts of the residential health care facility. In most cases, the nursing homes pass on this assessment to the residents. This assessment is shown as a separate line item on the nursing home monthly bill.
Utilizing New York State tax form IT-258, an individual may claim a full credit on their state income tax return for the amounts directly paid to the facility for this assessment. An individual may claim the full credit for the amounts directly paid even if the resident may be receiving benefits from a long term care insurance policy. The resident may also claim this credit if he assigns his or her long term care insurance benefits to the nursing home.
The credit is not available if the assessment is paid through private health insurance, with public funds (such as Medicaid) or by a trust or other entity.
If an individual (such as a family member) other than the resident is actually paying the assessment, the individual who paid the assessment, not the resident, is entitled to claim the credit. The credit amount can be significant. Nursing homes often cost upwards of $100,000 a year and more. The credit on the assessment on a $100,000 a year payment would be $6,000. This is a direct income tax credit for the person who pays the nursing home assessment. The credit can also be refundable for those persons who do not have a New York State income tax liability.