State medicaid / Nursing Home Deductions

[moeh21]

Mom has Long Term Care Medicaid and is in a nursing home.  All of her income is given to nursing home (minus $75 personal allowance).  No taxes are taken out as this is what lawyers/Medicaid states needs to be done.

However, when doing State taxes, she owes money. Nothing for federal.

I don't understand how she can owe money when all income needs to go to nursing home (and more importantly, how she is expected to pay it).  

Any information/guidance appreciated.

[Vanessa A]

Which state?  Not all states give deductions for medical expenses.  If you are in a state that taxes income based on the income without any exclusions, it is possible that she could owe state taxes.

If you are unable to pay them you can contact your state and set up a payment agreement.