Irs Regulations Between for Profit and Not for Profit Hospitals
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IRS Regulations i
IRS Regulations between for Profit and not for Profit Hospitals
TUI UNIVERSITY
Natasha A. Looper
Module 2- Case Assignment
MHM535 – Hospital Administration
Dr. Jo
March 8, 2011
IRS Regulations 1
IRS Regulations between for Profit and not for Profit Hospitals
Discuss some of the IRS regulations that govern profit status for organizations, including hospitals?
IRS regulations that govern profit status for organizations, including hospitals are explained in the IRS publication 577 (rev. Oct 2010) which is named Tax-Exempt Status for Organizations and under Internal Revenue Service Code Section 501 (c) (3). The IRS considers an organization able to be considered for tax exemption if it is either “a trust, a corporation or an association” (The Internal Revenue Service (2010). State laws and certain language of the IRS must be considered when an organization is a trust, a corporation or an association. In additional, funds can not be given to individuals and organizations can not be active lobbyist. Organizations must be restricted to “religious, charitable, scientific, educations and literacy purposes. Qualified organizations for example are old-age homes, charitable hospitals, schools and churches” (IRS publication 577 (rev. Oct 2010).
Based on the IRS regulations, explain the differences between for profit and not for profit hospitals?
Based on the IRS regulations, the differences between for profit and not for profit hospitals are the following. The first difference is how each hospital can use their excess revenue or profit, which includes interest with bonds. For example, “ since bonds are obtained at a lower interest rate (therefore yielding a lower rate) and are tax exempt to the bond owner, the government does not want nonprofit hospitals earning...
IRS Regulations between for Profit and not for Profit Hospitals
TUI UNIVERSITY
Natasha A. Looper
Module 2- Case Assignment
MHM535 – Hospital Administration
Dr. Jo
March 8, 2011
IRS Regulations 1
IRS Regulations between for Profit and not for Profit Hospitals
Discuss some of the IRS regulations that govern profit status for organizations, including hospitals?
IRS regulations that govern profit status for organizations, including hospitals are explained in the IRS publication 577 (rev. Oct 2010) which is named Tax-Exempt Status for Organizations and under Internal Revenue Service Code Section 501 (c) (3). The IRS considers an organization able to be considered for tax exemption if it is either “a trust, a corporation or an association” (The Internal Revenue Service (2010). State laws and certain language of the IRS must be considered when an organization is a trust, a corporation or an association. In additional, funds can not be given to individuals and organizations can not be active lobbyist. Organizations must be restricted to “religious, charitable, scientific, educations and literacy purposes. Qualified organizations for example are old-age homes, charitable hospitals, schools and churches” (IRS publication 577 (rev. Oct 2010).
Based on the IRS regulations, explain the differences between for profit and not for profit hospitals?
Based on the IRS regulations, the differences between for profit and not for profit hospitals are the following. The first difference is how each hospital can use their excess revenue or profit, which includes interest with bonds. For example, “ since bonds are obtained at a lower interest rate (therefore yielding a lower rate) and are tax exempt to the bond owner, the government does not want nonprofit hospitals earning...