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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: J_F_Shepard who wrote (687854)	12/11/2012 10:43:10 PM
From: i-node	2 Recommendations Read Replies (1) \| Respond to of 1588216

As a tax expert, tell me this please......when a physician bills your insurance company, eg $100, and the insurance co. pays a pre-established fee say for 50$ and the patient pays a copay of $10, the physician has a write-off appear on his bill for $40. Question is.....does the physician use that write off as a deduction(business expense) to reduce his taxable income..? Well, I wouldn't call myself a tax expert at this point in time; however, your question doesn't require one. The physician reports as revenue net collections, not gross billings, so he isn't allowed to deduct writeoffs against it (that would be a double-counting of deductions). Almost all physicians report income on the cash basis, which means the money he collects is reported as revenue and the IRS has no interest in, or awareness of, the amounts written off. In the unusual situation that the physician is an accrual basis tax reporter, he would report the $100 as income and the $40 writeoff as a deduction; however, I've never recommended a physician report on the accrual basis and never done accounting for one who used accrual accounting. It is possible some physicians, such as medical oncologists, would have sufficient inventory that they would be required to report on the accrual method, but I've never seen that.