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The Tax Cuts and Jobs Act of 2017 is having an impact on the health care industry. Here, Stephanie Hollick, CPA, FHFMA, provides a preview of this topic which she will discuss at PICPA’s 2019 Health Care Conference.
By Jim DeLuccia, PICPA Communications Manager
Believe it or not, tax reform – also known as the Tax Cuts and Jobs Act (TCJA) of 2017 – is having an impact on the health care industry. Stephanie Hollick, CPA, FHFMA, senior manager with Baker Tilly in Williamsport, Pa., will explore this topic in greater detail at PICPA’s 2019 Health Care Conference, June 11-12 at Penn State Great Valley in Malvern, Pa. She spoke with me recently to preview her session, and outlined some of the major implications for CPAs working with health care clients, changes to Form 990, and the new tax law’s effects on unrelated business taxable income (UBTI).
One implication that I have been working on with my clients regarding the TCJA is employee parking. When the IRS released Notice 2018-99, which provided guidance on nondeductible transportation benefits, it stated that if the health care entity
provides free parking to employees, there is a possibility that they will be required to pay tax on the cost of that parking.
The main benefit of a cost segregation study is to reclassify personal property from building assets to personal property assets, which have shorter depreciable lives. For tax purposes, these shorter depreciable lives will contribute to reducing current income tax obligations for for-profit entities.
There were no major changes to Form 990 for 2018. But some of the minor changes are as follows:
Given the clarification on nondeductible transportation benefits and the removal of the ability to offset unrelated business income activities, there are many more health care entities that will be required to file a Form 990-T and pay unrelated business
income tax.
For more information on how the TCJA affects the health care industry, make sure to check out Hollick’s presentation at the June 11-12 PICPA Health Care Conference.
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