Long-Term Care Question: My Mother in Assisted Living Has Outstanding Credit Card Debt – What Should She Do?

You could file for bankruptcy on your mother’s behalf, but it is doubtful that would be necessary. Your mother is what is often referred to as “judgment proof,” meaning that even if she were successfully sued, her creditors wouldn’t get anything. She/you could either write or call the credit card companies and let them know the circumstances. They may write off the debts and then send your mother 1099s. The written-off debts will be considered taxable income for your mother, but I’d assume, given her circumstances, that she’ll have to pay little or no taxes on this income.