Ambulatory surgery center joint ventures involving tax-exempt entities

J Health Care Finance. 1999 Summer;25(4):47-58.

Abstract

This article provides an overview of the tax-exempt related issues for ambulatory surgery center joint ventures involving tax-exempt entities. The article analyzes the key points of analysis of the guidance released by the IRS, in particular General Counsel Memorandum 39862, Revenue Ruling 98-15, and Redlands Surgical Services v. Commissioner of the Internal Revenue Service. These key points include whether the venture results in private inurement to insiders and whether the venture furthers the charitable purposes of the tax-exempt entity. The article also provides practical guidance to analyze the documents and structure of the joint venture to ensure compliance with the IRS guidance. These practical considerations include, among other things, whether the charitable purposes of the tax-exempt entity are clearly expressed in the documents and whether the tax-exempt entity has sufficient control over the joint venture to ensure the charitable purposes are being adhered to.

Publication types

  • Review

MeSH terms

  • Charities / economics
  • Charities / legislation & jurisprudence
  • Community-Institutional Relations / economics
  • Guidelines as Topic
  • Hospital-Physician Joint Ventures / economics*
  • Hospital-Physician Joint Ventures / legislation & jurisprudence
  • Humans
  • Investments / economics
  • Investments / legislation & jurisprudence
  • Organizational Affiliation / economics
  • Organizational Affiliation / legislation & jurisprudence
  • Surgicenters / economics*
  • Surgicenters / organization & administration
  • Tax Exemption / legislation & jurisprudence*
  • United States