Closing proceeds /gift

deleted

She or her trust sold the home not you or your siblings.  If the sale was taxable then her or her trust would report the sale not you.

If you have not yet consulted an elder law attorney for medicaid/medicare tax planning you really should ... there is a 5 year look back period on all gifts so this may not have been the best way to handle selling the home.

By all means, consult an elder law attorney.  And do not start spending a dime of that money.  Medicaid might come after it.

deleted

Earned income for income tax purposes or for medicaid purposes for you are not the same issues as the 5 year claw back for medicaid/medicare for your mom.   Seek an attorney.

I would NOT be listening to tax advice or advice about what Medicaid might do from a Social Security office employee.  Please see an attorney.

deleted

You are welcome.  It can get really complicated when you are dealing with the finances of an elderly parent.  As Critter#2 pointed out, there is a five year lookback in many states if your mom ends up needing to have her nursing home care paid for by Medicaid.  They then look at EVERY record of her finances for the previous 5 years--banking records, tax returns, investments, large purchases, gifts she gave, etc.  There is a "spend down" process for assets that allows certain expenditures such as pre-paying for funeral/burial expenses, etc.  Large gifts of cash, however, could end up being disallowed, and then Medicaid could seek to recover the money your mom gave to you.  You need an attorney to look carefully at the "trust" created and see if it will be ok for you and your siblings.  Hope it all works out for you.

This is scary. There's so many different ways a trust can be set up, and just as many ways distributions from a trust can be "clawed back" by those who may legally be entitled to it.

deleted