[eBook Code] The Law of Tax-Exempt Healthcare Organizations, + website (eBook Code, 4th)

Preface ix

About the Authors xi

Book Citations xv

1 Tax-Exempt Healthcare Organizations: An Overview 1

1.2 Defining Tax-Exempt Organizations 1

1.5 Charitable Healthcare Organizations 1

1.8 Promotion of Health 2

1.10 ABLE Programs 2

3 Public Charities and Private Foundations (New) 5

3.3 Commerciality Doctrine 5

4 Private Inurement, Private Benefit, and Excess Benefit Transactions 9

4.4 Private Inurement—Scope and Types 9

4.6 Essence of Private Benefit 10

4.9 Excess Benefit Transactions 12

5 Public Charities and Private Foundations 13

5.1 Public Institutions 13

5.6 Recognition of Change in Public Charity Status 13

7 Lobbying and Political Activities 15

7.1 Legislative Activities Limitation 15

7.4 Political Activities Limitation 16

7.5 Business Expense Deduction Rules and Political Activities 18

7.7 Public Policy Advocacy Activities 19

7.8 Political Activities of Social Welfare Organizations 19

8 Hospitals 21

8.3 Public Hospitals 21

9 Managed Care Organizations 23

9.3 Commercial-Type Insurance Providers 23

9.5 Recent Developments 23

13 Other Provider and Supplier Organizations 27

13.3 Qualified Nonprofit Health Insurance Issuers 27

13.5 Accountable Care Organizations 28

16 For-Profit Subsidiaries 33

16.3 Attribution of Subsidiary’s Activities to Exempt Parent 33

17 Exempt and Nonexempt Cooperatives 35

17.1 Cooperative Hospital Service Organizations 35

18 Business Leagues 37

18.1 Business Leagues in General 37

18.2 Healthcare Trade Associations 38

19 Other Health-Related Organizations 39

19.4 Hospital Management Services Organizations 39

19.5 Regional Health Information Organizations 40

20 Healthcare Provider Reorganizations 41

20.1 Some Basics about Reorganizations 41

21 Mergers and Conversions 43

21.4 Conversion from Nonexempt to Exempt Status 43

22 Partnerships and Joint Ventures (New) 45

22.9 Whole-Hospital Joint Ventures 45

24 Tax Treatment of Unrelated Business Activities 47

24.2 Definition of Trade or Business 47

24.3 Definition of Regularly Carried On 49

24.5 Application of Substantially Related Test to Healthcare Organizations 50

24.11 Pharmacy, Medical Supplies, and Service Sales 51

24.12 Laboratory Testing Services 51

24.13 Medical Research 52

24.18 Other Exceptions to Unrelated Income Taxation 53

24.20 Revenue from Controlled Organizations 55

24.21 Unrelated Debt-Financed Income 55

24.23 Computation of Unrelated Business Taxable Income 55

25 Physician Recruitment and Retention 61

25.5 Specific Recruitment and Retention Techniques 61

26 Charity Care 63

26.6 Definitional and Reporting Issues 63

26.9 Charity Care and National Health Reform 64

26.10 Additional Statutory Requirements for Hospitals 64

26.12 Provider Taxes (New) 82

27 Worker Classification and Employment Taxes 85

27.7 Medical Residents and the Student Exception 85

28 Compensation and Employee Benefits 87

28.3 Executive Compensation 87

28.5 Overview of Employee Benefits Law 87

28.6 Deferred Compensation in General 88

28.7 Excessive Executive Compensation (New) 91

30 Tax-Exempt Bond Financing 95

30.3 Disqualification of Tax-Exempt Bonds 95

31 Fundraising Regulation 105

31.2 Federal Law Regulation 105

33 Governance 107

33.4A IRS Ruling Policy 107

34 Exemption and Public Charity Recognition Processes 111

34.1 Exemption Recognition Process 111

34.5 Public Charity Status 121

34.6 Group Exemption 121

34.7A Notice Requirements for Social Welfare Organizations (New) 122

34.8 Procedure Where Determination Is Adverse 123

34.9 Constitutional Law Aspects of Process 125

35 Maintenance of Tax-Exempt Status and Avoidance of Penalties 127

35.1 Material Changes 127

35.2A Modification of Tax Exemption (New) 129

35.4 Redesigned Annual Information Return 129

35.5 Disclosure Requirements 130

35.6 IRS Disclosure to State Officials 131

36 IRS Audits of Healthcare Organizations 133

36.2 Audit Procedures 133

Cumulative Table of Cases 139

Cumulative Table of IRS Revenue Rulings 149

Cumulative Table of IRS Revenue Procedures 153

Cumulative Table of IRS Private Letter Rulings 155

Cumulative Table of IRS Technical Advice Memoranda 161

Table of Chief Counsel Advice Memoranda 163

Cumulative Table of IRS General Counsel Memoranda 165

Table of Tax Reform Legislation 167

Cumulative Index 173