My brother passed away unexpectedly at the age of 57. I am the administrator of his estate. He was not married, had no children, and died without a will. A small 401k and two insurance policies were designated with his long time partner as the beneficiary and have passed to her. The rest of his estate, including a larger 401k which had no named beneficiary, will be distributed by NY State law to our 93 year old mother as the sole beneficiary. She has Alzheimer’s, resides in assisted living in Ohio, and receives Medicaid. The larger 401k of $120,000 was distributed to his estate account with 20% federal tax withheld in 2023. I am now doing his estate income tax Form 1041. He had about $2,000 other income in 2023, no capital gains, no dividends, no Schedule A or B. I have made some deductions for estate administration expenses.

Here are my questions: First, referring to the estate income tax rate from Schedule G, I am calculating a whopping $42,000 total tax bill with most of the distribution taxed at 37%. Does this sound correct? Am I proceeding correctly?

Second, when the estate gets distributed to my mother that will disqualify her from Medicaid and she will pay her own way in the assisted living. However, will the state of Ohio bill her for any Medicaid benefits previously received? This will immediately drain her assets and put her back on Medicaid.

Thank you for any assistance you can provide.