Medicaid Income & Asset Limits
by State (2026 Guide)

What Counts as Income for Medicaid?

Medicaid counts nearly all money coming in as income — and for long-term care Medicaid, this matters in two ways. First, it determines whether you're in an income cap state (where income above a threshold disqualifies you without a trust). Second, it determines how much you contribute toward the cost of care each month after you're approved.

Most income sources are countable. A few are not. Here's how they break down:

Countable Income Sources

• Social Security retirement benefits (SSA) — counted in full
• Social Security Disability Insurance (SSDI) — counted in full
• Supplemental Security Income (SSI) — counted in full
• Pension income — government pensions, private pensions, union pensions
• VA benefits — Aid & Attendance and regular disability compensation are generally countable (Aid & Attendance has specific rules)
• Required Minimum Distributions (RMDs) from IRAs and 401(k)s — counted as income
• Rental income — net income from rental properties
• Investment income — dividends, interest, capital gains distributions
• Wages and self-employment income
• Annuity payments — from commercial annuities or Medicaid-compliant annuities

What Is NOT Counted as Income

• One-time gifts or lump-sum inheritances (counted as assets once received)
• Proceeds from the sale of a home (counted as assets)
• Loans (money borrowed, not income)
• Tax refunds
• In-kind support (food or shelter provided by others, in most cases)

2026 Medicaid Income Limits by State

For nursing home and long-term care Medicaid, states fall into two categories. Income cap states require income to be below 300% of the SSI Federal Benefit Rate — which is $2,829/month in 2026. If your income exceeds this, you can still qualify using a Qualified Income Trust (also called a Miller Trust).

Medically needy states don't cap income. Instead, once approved, you pay nearly all your income toward the cost of care (the state covers the rest), keeping only a small Personal Needs Allowance.

Note: Personal Needs Allowances are the amounts Medicaid residents keep from their income each month for personal expenses. Everything above that goes toward the nursing home cost. Figures reflect 2026 state policies.

How a Miller Trust Works

If you live in Indiana or Ohio and your monthly income exceeds $2,829, a Miller Trust (Qualified Income Trust) lets you qualify for Medicaid anyway. Here's how: you deposit all income into the trust account each month, Medicaid "ignores" the excess income, you withdraw what's needed for allowable expenses (personal needs allowance, spouse's income allowance, Medicare premiums), and the remainder goes toward your care cost. When you pass, any funds left in the trust go to the state to reimburse Medicaid costs.

Miller Trusts must be established by an elder law attorney and properly administered. An error in trust administration can result in Medicaid disqualification.

What Counts as an Asset for Medicaid?

Medicaid divides everything you own into two buckets: countable assets (things Medicaid adds up against the limit) and exempt assets (things Medicaid ignores). Understanding this distinction is the foundation of Medicaid planning.

The IRA Question

IRAs and 401(k)s are a gray area and one of the most common sources of confusion. In most Midwest states, an IRA in payout status (where the owner is taking required minimum distributions) is treated as an income stream rather than a countable asset. The account balance isn't counted; the monthly RMD is counted as income.

However, an IRA that is not in payout status — where the owner hasn't started taking RMDs — is typically counted as a countable asset in IL, IN, OH, WI, and MI. If you have a large IRA, consult an elder law attorney before applying. The timing of when you start distributions can significantly affect your Medicaid eligibility.

Revocable vs. Irrevocable Trusts

Assets in a revocable living trust are counted — because you can still access them, they're effectively still yours. Assets in an irrevocable trust established more than 5 years before you apply are generally not counted, because you've permanently relinquished control. This is the mechanism behind Medicaid Asset Protection Trusts (MAPTs). Read more in our spend-down strategies guide.

2026 Medicaid Asset Limits by State

The asset limits below apply to nursing home and long-term care Medicaid. The figures are consistent across all five Midwest states we cover — driven by federal minimums — but there are important state-specific nuances in how they're applied.

The Community Spouse Resource Allowance (CSRA) is the amount the at-home spouse can retain when the other enters a nursing home. The 2026 federal maximum is $154,140. The minimum is $30,828 (used when half of combined assets is below that floor). All five states listed use the full federal maximum.

How the CSRA Is Calculated

When a married couple applies for Medicaid, the state looks at all countable assets owned jointly or individually as of the "snapshot date" (the first day of the month of continuous institutionalization). From that total:

1. Divide combined countable assets in half
2. The community spouse keeps the greater of half or $30,828 — up to $154,140
3. The institutionalized spouse must spend down to $2,000

Example: A couple has $280,000 in combined countable assets. Half = $140,000. The community spouse keeps $140,000 (under the $154,140 maximum). The institutionalized spouse must spend down to $2,000, meaning $138,000 needs to be legally redirected before Medicaid kicks in.

This is where spend-down strategies come in: converting the $138,000 into exempt assets or legitimate expenses rather than simply depleting it on nursing home costs.

What If You're Over the Limit?

Being over the asset or income limit doesn't mean Medicaid is off the table — it means you have planning to do first.

If Your Assets Are Too High

You need to reduce your countable assets to your state's limit. The legal way to do this is through spend-down strategies: converting countable assets into exempt ones (like home improvements), paying legitimate debts, purchasing prepaid irrevocable burial plans, or establishing Medicaid-compliant annuities. Giving money away is not a valid strategy — it triggers the 5-year lookback penalty.

Our full guide covers all six strategies in detail: Medicaid Spend-Down Strategies: How to Protect Your Assets in 2026.

If Your Income Is Too High (Indiana & Ohio)

If you're in Indiana or Ohio and your monthly income exceeds $2,829, you need a Miller Trust (Qualified Income Trust). This is a straightforward solution but requires an attorney to set up properly. Once the trust is in place, your excess income routes through it monthly and you remain eligible for Medicaid.

Check Your Medicaid Eligibility in 5 Minutes

The tables above give you the framework. But eligibility isn't just about hitting a number — it's about which assets are countable, how your income is structured, and whether you've made any transfers in the past 5 years. Those variables change the picture significantly.

Willwright's free tools help you work through it before you talk to an attorney:

• Free Medicaid Eligibility Check — Answer a few questions about your income, assets, state, and marital status. Get a plain-English assessment of where you stand and what steps come next.
• Spend-Down Calculator — If your assets exceed the limit, see exactly how much you need to reduce and which strategies apply to your situation.
• Lookback Penalty Calculator — If you've made gifts in the past 5 years, calculate the penalty period before you apply.

If you're just starting and want to understand the full qualification process — income, assets, look-back, and application — read our comprehensive guide: How to Qualify for Medicaid Long-Term Care (2026 Step-by-Step Guide).

If protecting the family home is your primary concern, read our dedicated guide: How to Protect Your Home from Medicaid Estate Recovery — which covers irrevocable trusts, ladybird deeds, life estate deeds, and the caregiver child exemption.

Frequently Asked Questions

What is the Medicaid income limit for 2026?

It depends on your state. For nursing home Medicaid, Indiana and Ohio are income cap states with a limit of $2,829/month in 2026 (300% of the SSI Federal Benefit Rate). If your income exceeds this, you can qualify using a Miller Trust. Illinois, Wisconsin, and Michigan are medically needy states with no income cap — your income goes toward the cost of care and Medicaid covers the rest. You keep only a small Personal Needs Allowance each month.

What is the Medicaid asset limit for 2026?

In all five Midwest states covered here (IL, WI, IN, OH, MI), the asset limit for a single applicant is $2,000. For married couples, the community spouse can keep up to $154,140 under the Community Spouse Resource Allowance (CSRA). The primary home, one vehicle, and personal belongings are exempt and don't count toward the limit.

Does Social Security count as income for Medicaid?

Yes. Social Security retirement, SSDI, and SSI all count as income for Medicaid long-term care. In medically needy states (IL, WI, MI), this income is applied toward your cost of care — you keep a small personal needs allowance and Medicaid covers the remainder. In income cap states (IN, OH), Social Security plus other income must stay under $2,829/month, or you use a Miller Trust to handle the excess.

Is my home counted as an asset for Medicaid?

No — your primary home is exempt from Medicaid's asset count as long as you (or your spouse or a dependent child) reside there, and home equity is under $713,000. However, after death, the state's Medicaid Estate Recovery Program (MERP) can seek repayment from your estate. Protecting the home long-term requires strategies like an irrevocable trust or enhanced life estate deed. Read the home protection guide.

What is a Miller Trust and do I need one?

A Miller Trust (Qualified Income Trust) is required in income cap states — Indiana and Ohio — when monthly income exceeds $2,829. Income flows into the trust monthly; the trust pays allowable expenses, and the rest goes toward care costs. Illinois, Wisconsin, and Michigan are medically needy states and generally don't require Miller Trusts. An elder law attorney must set up and administer a Miller Trust.

Does an IRA count as an asset for Medicaid?

It depends. An IRA in payout status (where required minimum distributions are being taken) is typically treated as income rather than an asset in IL, WI, IN, OH, and MI. An IRA not yet in payout status is usually counted as a countable asset. The timing of when you begin distributions can significantly affect eligibility. Consult an elder law attorney if you have substantial IRA balances before applying for Medicaid.