Isn’t the distinction that non-profit hospitals have to plow surplus’s revenue back into the hospital versus distributing profit to investors / owners?
If so, the tax exempt status seems aligned with how for profit businesses are taxed?
If so, the tax exempt status seems aligned with how for profit businesses are taxed?
Bottom line is that when you let privat businesses decide they will always choose profit over people.
Which is the same thing that would happen to the equipment supplier. You're in no way avoiding the tax, you're just having the equipment supplier pay it on their profits.
The tax rates aren’t the same and non-profits aren’t forbidden from hiring businesses for contracts, pooling money, buying property, nor securing loans.
It’s a good model for small NPs. It’s rife for large scale corruption at the scale of hundreds or thousands of employees.
The point is that we see executive salaries for NPs that match salaries for for-profits. That indicates a broken system.
At anything that could be considered a "high" salary, the personal income tax rates are higher than the corporate rates. Also, they would be exactly the same if the for-profit entity was an LLC or some other passthrough entity.
> non-profits aren’t forbidden from hiring businesses for contracts, pooling money, buying property, nor securing loans.
Neither are for-profit businesses. And then any businesses they hire would also be paying taxes on their profits.
> The point is that we see executive salaries for NPs that match salaries for for-profits. That indicates a broken system.
It indicates that the cost of hiring someone who knows how to run a hospital is the same regardless of whether you separately pay profits to shareholders.
Departments spending all their budget in the last month of the financial year, thereby justify the following year’s budget has been a thing forever.