Hospitals legally commit tax fraud, amirite?

I've never heard of them reporting the difference as a loss. Where did you hear that?

by Anonymous 1 week ago

I have worked for a few different practices and they totally did that. They also wrote off if they sent someone to collections.

by Anonymous 1 week ago

They also wrote off if they sent someone to collections. Why wouldn't you?

by Anonymous 1 week ago

Since the debt was technically sold to the collection company I didn't know that it counted a true loss

by Anonymous 1 week ago

The difference between the original outstanding amount and the amount the debt collection agency paid is the loss written off. The amount the debt collection agency paid would have already been reported as income so the transaction is just a collection on a receivable.

by Adventurous_Toe_7016 1 week ago

Huh, interesting

by Anonymous 1 week ago

If it's legal it is ipso facto not tax fraud. The word you are looking for is tax avoidance, which is something every smart person and company does to avoid working 40% of their life as a slave to the government

by Anonymous 1 week ago

I run a business I can't just make up donations

by Anonymous 1 week ago

No, but you also don't claim income that you never get paid.

by Capital-Seaweed-489 1 week ago

They write it off as a loss!!

by Anonymous 1 week ago

Think about what you just said. They write it off. Off of what? You can only write off a receivable as a loss if you've already booked it as income. You're not creating losses, you're just canceling out some taxable income you had on the books from when you created that invoice.

by Aggressive_Amoeba257 1 week ago

What do you think that really means? Do you think if they take a $1000 loss on a bill that they get to pay $1000 less in taxes?

by Ustark 1 week ago

No not to that extent Hypothetically I have a job that pays $1000 on that job I had an equipment failure that just so happened to cost me $1000. I now have zero reportable income from that job. This example is legal and respectable. They abuse the system to say they took a loss when they really didn't

by Anonymous 1 week ago

I don't know why you think they didn't take a loss. I'm in contracting we regularly have to negotiate bills put in for extras. We put in a bill for a certain amount the customer refuses to pay that certain amount they dispute it we end up taking off some of the hours, even though we really did work those hours. The job is still profitable but we took a loss on what we had planned on just like the hospital.

by Ustark 1 week ago

This isn't how tax write-offs work. There is no *expense' in the situation you're talking about. Expenses are things like supplies, salaries, rent etc. Those wont change regarless of who pays the final bill, only the income changes and no company is going to give up income to save 20% of it.

by Devonsauer 1 week ago

Thats an internal accounting write-off. It's not an expense you claim against profit for tax purposes (also known as a tax write-off).

by Devonsauer 1 week ago

Lol but that would require a knowledge of dual entry accounting, and that's far too much for their brains to comprehend.

by beaulah77 1 week ago

Yes it is source run a business read some articles 👍

by Anonymous 1 week ago

Then why dont hospitals charge a trillion dollars? Why doesn't every business do it? There may be some small tax benefit to doing this somehow but its not because of an expense write-off. I'm not very familiar with American tax-code but this one doesn't pass the sniff test.

by Devonsauer 1 week ago

It didn't pass the sniff test because OP is in way over their head on this. The reason this isn't fraud is because at the time the procedure was done, the hospital records the full amount of the original bill as revenue. Then, when they find out how much money will actually be collected, the difference is written off against the revenue so that what they are reporting is accurate to how much money they actually got.

by Adventurous_Toe_7016 1 week ago

This is an American issue enjoy your better system I don't know what to tell you lol

by Anonymous 1 week ago

I'm not seeing the connection to tax fraud in your argument. I think you mean over inflating prices.

by elinor28 1 week ago

No they do that as well however that's a different issue

by Anonymous 1 week ago

Because they consider it worth $100

by Anonymous 1 week ago

And how is that tax fraud? They are charging you way over retail value. That has zero to do with taxation.

by elinor28 1 week ago

Because it was "worth" 100 if you don't get the cheating you don't get it lol

by Anonymous 1 week ago

I get what over charging is and I get what tax fraud is. You're not describing tax fraud. Charging a patient $12 for an aspirin isn't the same as putting false info on a tax return.

by elinor28 1 week ago

Yeah it's a racket that nobody wants to talk about because God forbid we attack the broken health care industry

by Anonymous 1 week ago

Pretty sure it's the number one complaint for Americans.

by Anonymous 1 week ago

Think about it this way. The hospital has to book the $100 as revenue the second that its declared as income. When they struggle to collect, they get a deduction to bring that down to whatever was actually able to collect from the insurance company or a collection agency. So they're in same tax situation compared to if they charged a lower price and never wrote it down in the first place. Or the accountants use a method to estimate the appropriate amount for revenue in the first place based on past history (possible using an allowance for doubtful accounts estimation). Either way what you're talking about is a "pound of feathers vs a pound of rocks" argument and won't ultimately affect the K-1 income or C Corp income.

by Anonymous 1 week ago

Btw great contribution to the conversation lmao

by Anonymous 1 week ago

Should be illegal would be illegal if I tried it lol

by Anonymous 1 week ago