Doctor's Tax

[ecCA1]

CA and CT are looking into various ways to tax doctor's at a "2% rate." What do you guys think of this? Would you move out of a state if this were to be implemented?

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[Coastie]

How about a politician or bureaucrat tax? They cost us far more than any doctor ever could..

Give me a break..

 

[Noyac]

New Mexico lost quite a few docs with their Doctor's Tax.

 

[lushmd]

New Mexico lost quite a few docs with their Doctor's Tax.

I didn't know that they had one. How much is it? Damn, I had always considered living in Albuquerque...

 

[Noyac]

I didn't know that they had one. How much is it? Damn, I had always considered living in Albuquerque...

I'm not sure if they still have one or how much it is. The voters keep trying to repeal it but the politicians keep tabling it. So I am not the authority on New Mexico since haven't lived there in 7 yrs.

Here's an article for you, it was written in 2002:

http://www.bizjournals.com/albuquerque/stories/2002/12/09/story7.html

 

[deleted126335]

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[Noyac]

The reality is that when something pinches your income, Most of us will work harder to maintain income.

You would think.

 

[VolatileAgent]

CA and CT are looking into various ways to tax doctor's at a "2% rate." What do you guys think of this? Would you move out of a state if this were to be implemented?

this is horsesh*t and more proof the "gubernator" is only a republican on paper.

every year, insurance company bureacrats make more and more money pinching the system. their incentive is to not pay reimbursements to hospitals and healthcare providers. they are rewarded in year-end bonuses for preventing payouts. as it already stands, you have to jump through endless hoops to get a service covered, and many docs and utilization folks at hospitals spend hours on the phone talking with some insurance company gatekeeper trying to get a service covered. do you think this costs money? hell yes it does.

we waste an obscene amount of cash playing this game with companies. more and more people at insurance companies, who have to collect a salary, are there only to tell us "no". and they want to tax healthcare providers to pay for this nonsense?

the fact is the largest increase in healthcare cost has to do with the administration of healthcare. although this graphic illustrates nurses, the same is true for physicians... and it tells the real picture:

 

[mille125]

A doctor's tax on medical services is not fair for many reasons. I would like to bring up two.

1) Doctors cannot pass the tax on to their patients like every other industry in the country can and will to their consumers.

2) Doctors already pay a hidden tax in the form of acceptance of reimbursement for medicare, medicaid, and uncompensated care. We are pinched by government and big business which is unheard of in any other service model.


Texas has introduced a tax on all business which is 1% of gross receipts. After much deliberation with the TMA, Texas decided to allow physicians to deduct salaries up to 300K as well as the cost of medicare, medicaid, worker's comp, and uncompensated care from the equation.


The moral of the story is that big business and government really do not care about us and will do everything possible to improve their bottom line. If this does not impress upon you to enter into PAC's at the state and national level or other agencies of organized medicine, I dont know what else will.

 

[Arch Guillotti]

the fact is the largest increase in healthcare cost has to do with the administration of healthcare. although this graphic illustrates nurses, the same is true for physicians... and it tells the real picture:

Don't know if I'd agree w/that. From a bit dated but pretty good NEJM article:

"Over the long term, new medical technology has been the dominant driver of increases in health care costs and insurance premiums"

http://content.nejm.org/cgi/content/full/351/16/1591

 

[deleted77919]

A further problem is (at least in CA) the proposal was to tax 2% of revenue, not income. Taxing revenue on an oncology practice at 2% could very well completely wipe out the physicians income.

I would expect people to move (that is to say, I would move).

 

[harryh]

A doctor's tax on medical services is not fair for many reasons.....


Texas has introduced a tax on all business which is 1% of gross receipts. After much deliberation with the TMA, Texas decided to allow physicians to deduct salaries up to 300K as well as the cost of medicare, medicaid, worker's comp, and uncompensated care from the equation.


The moral of the story is that big business and government really do not care about us and will do everything possible to improve their bottom line. If this does not impress upon you to enter into PAC's at the state and national level or other agencies of organized medicine, I dont know what else will.

Texas has a "franchise tax" This is essentially a state income tax on entities. Sole proprietorship are excluded, so if you have formed a corporation to allow you to deduct business expenses from 1099 income without getting hit by the AMT (alternative Minimum tax).

In Texas Physicians and dentists were able to form P.A. (professional associations) which were immune from the franchise TAX. Other professionals, accountants, lawyers, engineers and CRNA's had to form P.C. (professional corporation) or a LLC and had to pay the 5% franchise Tax.

This has recently changed so now Physicians and all other entities are treated equally and have to pay the 5% franchise tax on any income over the fist $300,000. Texas has no state Income Tax so the legislature is always looking for more money to spend buying votes and to benefit wealth lobbyists on worthless pork barrel projects. I am not sure of all the details but now physician are treated equally with other business entities and are not taxed on the first $300,000 of income. The revenue lost by not taxing the first $300,000 has been offset by a new gross receipts tax on most business entities, which I think physician's are exempt.

The net effect is that now Texas physicians entities have a 5% tax on all income over $300,000 and now have to file a State corporate income tax statement.

If you are looking for a low tax state to claim residence for 1099 income while traveling and working various locums assignments. I think Nevada clearly wins over Texas, Florida, Tennessee and New Hampshire. (TN, FL, NH have taxes on investment income and a wealth tax on net worth) I do not have any knowledge of Wyoming, South Dakota, Alaska and Washington.

 

[Coastie]

Interesting, as today Hill-dog (Hillary Clinton for everyone who didn't see that South Park) claimed that we all need to have "shared prosperity" replace the "ownership" society. Basically, have communism replace free markets (which she says even later on in the article).

http://biz.yahoo.com/ap/070529/clinton_economy.html?.v=1

You think taxes and healthcare are bad now? Just wait.

Thompson/Gingrich/Anyone but a democrat or Guiliani '08!

 

[mille125]

Texas has a “franchise tax” This is essentially a state income tax on entities. Sole proprietorship are excluded, so if you have formed a corporation to allow you to deduct business expenses from 1099 income without getting hit by the AMT (alternative Minimum tax).

In Texas Physicians and dentists were able to form P.A. (professional associations) which were immune from the franchise TAX. Other professionals, accountants, lawyers, engineers and CRNA’s had to form P.C. (professional corporation) or a LLC and had to pay the 5% franchise Tax.

This has recently changed so now Physicians and all other entities are treated equally and have to pay the 5% franchise tax on any income over the fist $300,000. Texas has no state Income Tax so the legislature is always looking for more money to spend buying votes and to benefit wealth lobbyists on worthless pork barrel projects. I am not sure of all the details but now physician are treated equally with other business entities and are not taxed on the first $300,000 of income. The revenue lost by not taxing the first $300,000 has been offset by a new gross receipts tax on most business entities, which I think physician’s are exempt.

The net effect is that now Texas physicians entities have a 5% tax on all income over $300,000 and now have to file a State corporate income tax statement.

If you are looking for a low tax state to claim residence for 1099 income while traveling and working various locums assignments. I think Nevada clearly wins over Texas, Florida, Tennessee and New Hampshire. (TN, FL, NH have taxes on investment income and a wealth tax on net worth) I do not have any knowledge of Wyoming, South Dakota, Alaska and Washington.

You are correct. The Texas "doctor's" tax that I alluded to is the Texas Franchise tax. However, many of your facts are incorrect. This is the real interpretation of the tax.


1) The Texas Franchise tax broadens the base of entities subject to the tax to now include many professional associations and partnerships. Physicians and other medical entities are NOT exempt. LLP's, partnerships and real estate/leasing partnerships are NOT exempt. Sole proprietors and FLP's are exempt. The legislation was enacted to allow for property tax relief.

2) The tax rate is actually 1 percent (not 5 percent). The tax will be assessed on "total revenue minus deductions". Businesses who owe less than $1000 in tax or who have less than 300K in net revenue will not be taxed.

3) Employee compensation is deductible up to 300K per employee (includes salary and benefits). In addition medical practices may deduct 100% of all medicare, tricare, workers compensation, and medicaid reimbursements.



The TMA was very instrumental in enacting point number three and should be thanked for their efforts. Many more practices would be burdened by this tax if not for the TMA.