Thursday, March 14, 2013

IRS Concludes EHR Incentive Payments are Income to Recipient and Reportable to IRS


The Internal Revenue Service recently concluded that recipients of incentive payments from CMS to utilize electronic health records must include the amounts received in gross income and that CMS must report these payments to the IRS.

In addition, the IRS guidance (issued in the form of a Chief Counsel Advice) gave details about how the reporting obligation is complied with for employed physicians.  In those instances, the actual recipient must report the payment.

With this guidance, which roughly coincided with the release of forms for the 2012 tax filing season, the IRS reminded physicians and hospitals of their obligations to include EHR payments in income.