By 2050, it is predicted that over 27 million individuals will need nursing care facilities or use some form of alternative residential care. This increase is due to the number of baby boomers who may need care by that time. This increase might mean added revenue for nursing home facilities. It also brings with it the additional challenges of senior and residential care practice tax planning and accounting.
Adapting to Changes in Healthcare Tax Laws
The Affordable Care Act has changed compliance requirements for healthcare organizations, including senior and residential care facilities. This means that senior and residential care practice CPAs must be adaptable in the way they approach senior and residential care practice tax planning. The need exists to diversify the way services are provided to members in the community and the way revenue is recorded.
Property Taxes for Senior and Residential Care Practice Facilities
Another issue that impacts senior and residential care practice accounting is property taxes. Property taxes are a hot button issue, especially as changes are being made to how commercial real estate in areas like Illinois and California is being assessed.
In most cases, senior and residential care practice accounting requires the provider to be partially responsible for property taxes in a community regardless of the ownership structure. This can be a real financial strain on property owners as property taxes are frequently the largest real estate associated expense for owners of a senior living property. Property managers should carefully monitor their senior and residential care practice bookkeeping to guarantee that they are covering their property tax obligations and appealing incorrect tax assessments with the goal of keeping their property tax burden as low as possible.
It is important for property managers to be vigilant with property tax laws because regulations can shift and assessors do not always have a clear vision of the nuanced space where senior living or assisted living facilities fit within state and local property tax laws. At Fusion CPA, our team of experienced senior and residential care practice financial advisers understand how property tax laws can impact your bottom line. Our CPAs can help you review your senior and residential care practice bookkeeping with the goal of minimizing your property taxes.
Understanding the Tax Challenges Experienced When senior and residential Care Facilities Change Hands
When a senior and residential care practice is sold, the county assessor will evaluate the purchase price when determining what the fair market value of the real estate is. However, when a facility of this type is sold, the purchase price is the price of the real estate and the value of the operations of the facility. When it’s assessed, the real estate and the business activities should be looked at separately. It is important to understand this detail because the assessment is the basis of the valuation of the property, which is used to determine how much is paid in property taxes.
Getting Advice from a senior and residential Care Practice CPA Firm That Understands Your Needs
Aspects of bookkeeping and tax regulations that are unique to the healthcare industry are just a few of the unique accounting challenges you face when managing your senior and residential care practice. Fusion CPA is a senior and residential care practice CFO business advisory firm that is experienced in working with facilities like yours.
Our senior and residential care practice financial advisers can provide you with an unbiased outside analysis of your accounting, bookkeeping, and tax planning. If you need help with accounting reports, contract negotiations, payroll, invoicing, or compliance, we are here for you. Learn more about the services our firm offers by pressing the discovery button below and scheduling a no-cost and no-obligation call with our team today.
This blog article is not intended to be the rendering of legal, accounting, tax advice, or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.