Business Entities – Corporations, LLCs and Proprietors


General:  The new tax law changes affecting corporations are the most dramatic.  The reduction in the corporate tax rate from 35% to 21% will be a boon for the economy, making the United States, from a tax standpoint, more competitive with the rest of the developed world.  Corporations, which since the 2008 financial crisis have […]

How to Be Sure That Your Automobile Insurance Covers Both You and Your Practice Entity

Let’s say that you practice through a corporation that owns your car.  If there is an accident, you want to be sure that the corporation can get reimbursed for the property damage and that both you and the corporation are insured if you are sued.  If you are sued, the corporation will also be sued […]

Health Insurance “Discrimination” In the C Corporation

Can the C Corporation Cover the Insurance Costs (Including Medicare) of Just the Doctor (and His or Her Family) But Not Cover Others? Yes.  Under IRS Regulation 1.105-11(b), you can discriminate based on classes of employees, but not based on ownership status.  For example, there can be a Board of Directors resolution that the corporation […]

Dissolving a Group Practice S Corp to Save Medicare Taxes

One of the key reasons to incorporate as an S corp is the ability to draw a lower W-2 compensation (subject to the 2.9%/3.8% Medicare tax) in order to leave a company profit.  The profit is subject to income tax on Schedule E of the owners’ 1040 tax returns but free of the Medicare tax.  […]

Multi-Specialty Group Practices

Over the past three years we have represented an increasing number of multi-specialty group practices, and we continue to field phone calls from clients who are considering this.  These are complicated transactions, and in some cases, the allure of joining forces turns out to be more aggravating and less profitable than anticipated.  There is no […]

SPECIAL ISSUE: The Allure (and Potential Future HUGE Allure) of S Corporations

An S corp is a corporation that is taxed like a partnership.  Generally it does not pay federal income tax.  Its income is passed through to its shareholders who report their proportionate shares on their personal tax returns.  The corporation is just a regular corporation for state law purposes that files an election with the […]

Section 336(e) of the Tax Code Permits a Purchaser and Seller in an All-Stock Practice Sale to Treat The Transaction as a Tax-Deductible Asset Sale – Which Can be a God Send for the Young Practice Buyer Hoping to Retain the Seller’s Grandfathered Delta Premier Status

Outright practice sales can be structured one of two ways.  The first is a stock sale, where the buyer purchases the seller’s stock in the practice corporation and takes over ownership.  This is a simple transaction.  The corporation is the same; it just has a new owner.  The second is an asset sale, where the […]

Annual Corporate Minutes

Every state requires that its corporations maintain certain requirements in order to preserve the liability protection granted to the corporate shareholders.  This includes drafting annual minutes of the shareholders and directors.  If we incorporated your practice (or even if we didn’t) and you would like us to prepare your annual minutes, complete as best you […]

Qualified Small Employer Health Reimbursement Arrangement (“QSEHRA”) — Questions and Answers

In the process of drafting these new plans for clients, several good questions have been raised.  Here are a few of them, along with answers, which should help you decide if this might be something beneficial in your practice.  This should be read in conjunction with the Jan. 1 and Jan. 15 Newsletters which covered […]

An Update on Tax Free Disability Benefits When Prior Premiums Have Been Paid by a Corporation

Note, the following concepts cannot work for (1) partnerships, (2) self-employed doctors or (3) S corporations since they cannot deduct an owner’s disability insurance costs.  We have been asked to comment again on our long-time suggestion that an incorporated doctor pay his own disability insurance premiums and then have the corporation reimburse him at the […]