28th Annual Tuesday & Wednesday, January 29‐30, 2019 Hya� Regency Columbus, Columbus, Ohio Workshop RR Healthcare & Non-Profit Industries … Unique Tax Issues Wednesday, January 30, 2019 2:00 p.m. to 3:00 p.m.
Biographical Information Jeffrey L. Stansberry, CPA, MT - Tax Manager, OhioHealth 80 E. Broad St, Columbus, OH 43215 jeffrey.stansberry@ohiohealth.com (614) 544-4336 Fax (614) 544-4470 Jeff started his career in public accounting and was at GBQ Partners for over four years. He then transitioned into industry and was at BISYS/Citi for over six years. After being in public and industry for nearly two decades, he decided to shift his focus into the tax exempt sector. For over three years, Jeff has lead up the tax department at OhioHealth, central Ohio’s largest healthcare system. Jeff is responsible for leading OhioHealth’s annual federal, state, and local tax compliance process while providing oversight and communication to the entire system of over 20,000 employees. Jeff is a graduate of The Ohio State University with a BS in Business Administration (Honor Classes) and received a Master’s in Taxation from Capital University Law School. Christopher J. Swift, Partner, Baker Hostetler LLP 1900 East 9th Street, Suite 3200, Cleveland, OH 44114-3482 cswift@bakerlaw.com 216.861.7461 Chris Swift is a healthcare and tax lawyer who counsels the healthcare industry and other businesses by guiding them through governmental, tax and regulatory issues. He keeps non-profit organizations tax-exempt, assists all taxpayers in reducing state and local taxes and finds tax and regulatory incentives to grow companies. He currently serves both as a National Co-Leader of the firm’s Healthcare Industry Team and as Coordinator of the Cleveland office’s Tax, Personal Planning and Employee Benefits Group. He served as a member of the firm’s Policy Committee from 2004 through 2009. Chris has lectured on state and local taxes to several organizations, including the Cleveland Metropolitan Bar Association, the Columbus Bar Association and the Committee on State Taxation. In 1988, he was the Chair of the Cleveland Bar Association’s State and Local Tax Institute. In 1990-91, he served as Chair of the Cleveland Bar Association’s General Tax Committee. Chris has also served as Chair of the 2008 Cleveland Tax Institute and the CMBA’s 1998 Health Law Institute. Chris is a member of the American, Ohio and Cleveland Metropolitan Bar Associations, as well as the American Health Lawyers Association. Since 1997, Chris has been listed annually in the Best Lawyers in America. He was named by Best Lawyers as “2010 Cleveland Tax Lawyer of the Year” and “2011 Cleveland Health Care Lawyer of the Year.” Both honors are bestowed upon only one lawyer per specialty in each community. Chris has been named an “Ohio Super Lawyer” for the past ten years. Carol Lalonde, CPA, Tax Senior Manager, Plante Moran, PLLC 750 Trade Centre Way, Portage, MI 49002 Carol.Lalonde@plantemoran.com 269.567.4587 Fax: 248.233.8672 Carol Lalonda is a senior tax manager spending 100% of her time focused on the taxation of higher education institutions, healthcare organizations, and other tax-exempt organizations. As the firm’s higher education tax leader, she provides tax advice on all areas of exempt organization taxation, including all aspects of the Form 990 and 990T, as well as international and state & local tax reporting. Carol has successfully, and favorably, represented numerous clients under IRS examination. She is a frequent speaker at external training seminars at the local, regional and national levels and also has regularly conduct webinars and write articles on relevant tax issues for both higher education and healthcare institutions.
Biographical Information Jeffrey L. Stansberry, CPA, MT - Tax Manager, OhioHealth 80 E. Broad St, Columbus, OH 43215 jeffrey.stansberry@ohiohealth.com (614) 544-4336 Fax (614) 544-4470 Jeff started his career in public accounting and was at GBQ Partners for over four years. He then transitioned into industry and was at BISYS/Citi for over six years. After being in public and industry for nearly two decades, he decided to shift his focus into the tax exempt sector. For over three years, Jeff has lead up the tax department at OhioHealth, central Ohio’s largest healthcare system. Jeff is responsible for leading OhioHealth’s annual federal, state, and local tax compliance process while providing oversight and communication to the entire system of over 20,000 employees. Jeff is a graduate of The Ohio State University with a BS in Business Administration (Honor Classes) and received a Master’s in Taxation from Capital University Law School. Christopher J. Swift, Partner, Baker Hostetler LLP 1900 East 9th Street, Suite 3200, Cleveland, OH 44114-3482 cswift@bakerlaw.com 216.861.7461 Chris Swift is a healthcare and tax lawyer who counsels the healthcare industry and other businesses by guiding them through governmental, tax and regulatory issues. He keeps non-profit organizations tax-exempt, assists all taxpayers in reducing state and local taxes and finds tax and regulatory incentives to grow companies. He currently serves both as a National Co-Leader of the firm’s Healthcare Industry Team and as Coordinator of the Cleveland office’s Tax, Personal Planning and Employee Benefits Group. He served as a member of the firm’s Policy Committee from 2004 through 2009. Chris has lectured on state and local taxes to several organizations, including the Cleveland Metropolitan Bar Association, the Columbus Bar Association and the Committee on State Taxation. In 1988, he was the Chair of the Cleveland Bar Association’s State and Local Tax Institute. In 1990-91, he served as Chair of the Cleveland Bar Association’s General Tax Committee. Chris has also served as Chair of the 2008 Cleveland Tax Institute and the CMBA’s 1998 Health Law Institute. Chris is a member of the American, Ohio and Cleveland Metropolitan Bar Associations, as well as the American Health Lawyers Association. Since 1997, Chris has been listed annually in the Best Lawyers in America. He was named by Best Lawyers as “2010 Cleveland Tax Lawyer of the Year” and “2011 Cleveland Health Care Lawyer of the Year.” Both honors are bestowed upon only one lawyer per specialty in each community. Chris has been named an “Ohio Super Lawyer” for the past ten years. Carol Lalonde, CPA, Tax Senior Manager, Plante Moran, PLLC 750 Trade Centre Way, Portage, MI 49002 Carol.Lalonde@plantemoran.com 269.567.4587 Fax: 248.233.8672 Carol Lalonda is a senior tax manager spending 100% of her time focused on the taxation of higher education institutions, healthcare organizations, and other tax-exempt organizations. As the firm’s higher education tax leader, she provides tax advice on all areas of exempt organization taxation, including all aspects of the Form 990 and 990T, as well as international and state & local tax reporting. Carol has successfully, and favorably, represented numerous clients under IRS examination. She is a frequent speaker at external training seminars at the local, regional and national levels and also has regularly conduct webinars and write articles on relevant tax issues for both higher education and healthcare institutions.
Healthcare Industry & Nonprofit Entities Unique Tax Issues Jeffrey Stansberry - OhioHealth Christopher Swift - Baker Hostetler Carol Lalonde - Plante Moran
Agenda • Federal Tax Exemption • Choice of Entity • Ohio Definitions • TCJA Impacts • Ohio Hospital Considerations • Recent Case Law Updates 2
Impact of External Change • Federal and State Health Care Policy ‒ EMTALA and other Safety Net Acts applicable to for-profit providers ‒ Affordable Care Act ‒ Expansion of Medicaid ‒ Schedule H of Form 990 • Correlation of Value of Tax Benefits to Level of Charitable Care ‒ Percentage of Charitable Care is decreasing • How Much is Enough? 3
Basis for Federal Income Tax Exemption • Section 510(c)(3) requires that the corporation be “organized and operated exclusively for religious, charitable, scientific . . . Or educational purposes” and that “no part of the net earnings of which inures to the benefit of any private shareholder or individual.” 4
Choice of Entity • Chapter 1702 of the Ohio Revised Code (Ohio Nonprofit Corporation Law) • Some nonprofits are unincorporated associations, trusts, limited liability companies, partnerships, or disregarded entities • Section 501 of the Internal Revenue Code ‒ While many nonprofits are tax-exempt for federal income tax purposes under Section 501(c)(3), there are many subsections like Section 501(c)(4) ‒ Some nonprofits are taxable ‒ Some for-profit corporations are tax-exempt 5
Choice of Entity • Different Rules for Different Taxes ‒ Federal Income Tax ‒ FUTA/SUTA • Reimbursing Employer Status ‒ Ohio Franchise Tax ‒ Ohio Sales & Use Tax ‒ Ohio Real Property Tax ‒ Ohio Commercial Activity Tax 6
Ohio Nonprofit Corporation Definition • Ohio Rev. Code 1702.01(C) defines “Nonprofit Corporation” as a “corporation that is formed otherwise than for the pecuniary gain or profit of, and whose net earnings or any part of them is not distributable to, its members . . . .” 7
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