Four Year End Tax Planning Tips
Whether you're looking to maximize savings or take advantage of credits, there are steps you can take to ensure you're keeping more of your hard-earned money. Here are four strategies... Read More >
In addition to my revenue-building service, I offer a range of specialized offerings to physician medical practices, of which a partial list is below. Please feel free to call me at 281-379-5988 to inquire about any of these services.
Compilation and Preparation
If required, a compilation or preparation of financial statements is defined as presenting in the form of financial statements information that is the representation of management (owners) without undertaking to express any assurance on the statements.
Independent Review of Internally Prepared Financials
For physician practices who prepare their own financial statements internally, it is often a good idea to have them independently reviewed by a Reed Tinsley CPA. This review can be conducted on a monthly, quarterly, semi-annual, or annual basis. You must make sure they are receiving accurate, reliable financial information. This also allows for ongoing tax review and related planning.
Financial Forecasts and Projections
A physician practice might want or need to prepare a financial forecast for
many reasons:
- to budget income and expenses for the upcoming year
- or general business planning purposes
- to aid in the valuation of the entity
- to fulfill a lender’s requirement for granting a loan
The difference between a forecast and a projection is that in a forecast, all the assumptions are expected to occur, whereas in a projection at least one assumption is not necessarily expected to occur and may be improbable. In other words, a forecast presents management’s expectations; a projection presents management’s expectations based on a ‘what if’ situation.
Personal Financial Statements
There may be a time when a physician needs to have a prepared personal financial statement. Personal financial statements are sometimes needed when obtaining a bank loan, for tax or estate planning, or during the preparation of a personal financial plan.
Taxes
Diagnostic business planning begins with the evaluation of the overall finances of the medical practice. Particular emphasis should be placed on charges, collections, adjustments, and other write offs. Is the practice growing or are the doctors working harder to maintain the same income level? As a CPA dedicated to physicians and their medical practices, my goal is to minimize your tax burden and make sure there are no year-end tax surprises. My tax services include the following:
- Tax planning and analysis
- Tax projections and analysis
- Tax preparation Federal and State
- Representation before taxing authorities
- Problem resolution
- Practice acquisition/divestiture tax consulting
- Structuring of physician buy-ins and buy-outs
- Tax impact of proposed practice merger
- Practice valuation tax analysis
Nontraditional Medical Accounting Services
Diagnostic business planning begins with the evaluation of the overall finances of the medical
practice. Particular emphasis should be placed on charges, collections, adjustments, and other
write offs. Is the practice growing or are the doctors working harder to maintain the same income
level?
Ongoing review of the practice’s gross collection percentage, net collection percentage, and accounts receivable ratio or days in A/R. Assess whether all these statistics are reasonable for the practice’s particular medical specialty.
Compare each overhead category to the same overhead category from the prior year. Identify and question significant changes. In addition, decide how the practice’s overall overhead can be reduced in the upcoming year.
Every practice needs to know what it costs to render a particular service. These calculations should be prepared at least annually.
Conduct an in-depth analysis of a current aging of the accounts receivable, with emphasis on payer aging’s.
Review all managed care plans to assess their profitability. If the plan’s rates or profitability are not acceptable, assess the potential for renegotiation.
Reed Tinsley offers a comprehensive suite of tax services for physicians. This includes, but is not limited to:
- Tax planning and analysis
- Tax projections and analysis
- Tax preparation Federal and State
- Representation before taxing authorities
- Problem resolution
- Practice acquisition/divestiture tax consulting
- Structuring of physician buy-ins and buy-outs
- Tax impact of proposed practice merger
- Practice valuation tax analysis
Reed Tinsley also offers specialized consulting tailored to physicians and their practices. The goal is to minimize tax burdens and ensure financial stability.
Minimizing IRS payments is everyone’s goal, especially physicians in a private practice. As a CPA, my role is proactive tax planning, not just a year-end task. Regularly reviewing Quickbooks or similar tools allows me to foresee potential tax implications. Unlike some CPAs who inform clients of a hefty tax bill at year-end, I emphasize ongoing communication to avoid surprises and be proactive rather than reactive. This approach allows physicians to focus on what they do best and not panic as tax session rolls around.
Absolutely! Personal financial statements are sometimes needed when obtaining a bank loan, for tax or estate planning, or during the preparation of a personal financial plan. Reed Tinsley is able to work with you through the process and ensure statements are prepared accurately and in time.
As a top advisor to physicians, I help increase practice profits by delivering hands-on,
expert medical accounting/tax support, practice counsel, and revenue-building strategies.
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