After reading this linked from PoF site:
https://www.kitces.com/blog/tax-cuts-and-jobs-act-2018-house-gop-tax-reform-proposal/
Not sure how this will affect physicians who own their practice in regards to the new rate. Since the doc is an "active owner" it appears that the 25% "capital rate" rate will be capped at 30% of pass-through income. Will this cap be adjusted if the owner can demonstrate a higher capital investment? For example, is the income generated from ancillaries or the technical component of procedures eligible to be taxed at the lower 25% pass-through rate?
How would capital investment into the practice, such as a start-up loan or personal investment of cash be treated with regards to the lower "capital rate" vs the higher "labor rate"?
https://www.kitces.com/blog/tax-cuts-and-jobs-act-2018-house-gop-tax-reform-proposal/
Not sure how this will affect physicians who own their practice in regards to the new rate. Since the doc is an "active owner" it appears that the 25% "capital rate" rate will be capped at 30% of pass-through income. Will this cap be adjusted if the owner can demonstrate a higher capital investment? For example, is the income generated from ancillaries or the technical component of procedures eligible to be taxed at the lower 25% pass-through rate?
How would capital investment into the practice, such as a start-up loan or personal investment of cash be treated with regards to the lower "capital rate" vs the higher "labor rate"?
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