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Jones & Roth is one of the largest CPA and Business Advisory firms with headquarters in Oregon.

Since 1946, we have been recognized as one of Oregon’s most trusted CPA firms. Our services span the areas of Tax, Audit & Assurance, Advisory, and Accounting & Payroll. Our CPAs also provide in-depth experience in over 10 specialty industries. Our goal is to have a positive impact in the lives of our clients, employees, and community.


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CMS Releases Final Rule for 2017 Medicare Physician Fee Schedule

CMS Releases Final Rule for 2017 Medicare Physician Fee Schedule

On November 2, 2016, the Centers for Medicare & Medicaid Services (CMS) released the Final Rule for 2017 Medicare Physician Fee Schedule.  It will be important for all practices and specialties to review the CMS ruling to see how they will be affected in the coming year. Elizabeth Woodcock’s newsletter article is a good overview of some of the changes.

Many of our clients will see positive and negative changes in the CMS release. The following are some of the changes outlined in the release and in Elizabeth Woodcock’s newsletter article:

  • 2017 MPFS conversion factor (CF) increased to $35.89 (2016 CF $35.80)
  • Ophthalmology and Urology see 2% reduction
  • Behavioral health sees new benefits in payment policies and new codes
  • Film-based imaging must use modifier –FX and will result in a 20% reduction in payment
  • Certain surgeons preforming select, high-volume, high-cost surgeries will be required to report post-operative care

 

Elliott Tracy, CPA is a Healthcare CPA and a member of the Jones & Roth Healthcare Team. He specializes in practice management, advisory services, and tax & accounting services for medical practices and clinics across Oregon & Southwest Washington. 

Physician Struggles in 2016

Physician Struggles in 2016

This year, the number of requests we received from clients and prospects asking for help with reimbursements, adjustments, and collections reached an all-time high.

In 2015, some of our clients saw their most profitable years and felt their practice was headed in the right direction. ICD-10 did not cause the end of the world, practices were receiving incentives for complying with meaningful use, and many were receiving the incentives as a patient-centered medical home.

So what has happened in 2016 that has changed the outlook of our healthcare clients?  Medical Economics published an article in December 2015 called “Top 10 Challenges Facing Physicians in 2016”, which highlights many of the same issues our clients are talking about:

  • Patients are choosing remote care versus going into the doctor’s office.
  • Expenses to run a practice continue to rise. The threat of a data breach and compliance with HIPAA is causing a significant cost increase to practices.
  • The US Department of Health and Human Services are pushing for a transition from volume to value-based outcomes.
  • Physicians believe they are losing or delaying reimbursements by not using the right ICD-10 code and/or quality metric.

I believe the primary reason for the increased demand for support on these issues is the final bullet point referenced—physicians are recognizing the increased complexity related to reimbursements and are not confident that everything is being done properly.

Our guidance is this: It is important for every practice to continually review their revenue cycle and look for ways to optimize. Trying to predict or forecast for cash flow is so important in a medical practice and optimizing your revenue cycle is one way to do that.

 

Elliott Tracy, CPA is a Healthcare CPA and a member of the Jones & Roth Healthcare Team. He specializes in practice management, advisory services, and tax & accounting services for medical practices and clinics across Oregon & Southwest Washington. 

 

There’s Still Time to Benefit on Your 2016 Tax Bill by Buying Business Assets

There’s Still Time to Benefit on Your 2016 Tax Bill by Buying Business Assets

In order to take advantage of two important depreciation tax breaks for business assets, you must place the assets in service by the end of the tax year. So you still have time to act for 2016.

Section 179 deduction

The Sec. 179 deduction is valuable because it allows businesses to deduct as depreciation up to 100% of the cost of qualifying assets in year 1 instead of depreciating the cost over a number of years. Sec. 179 can be used for fixed assets, such as equipment, software and leasehold improvements. Beginning in 2016, air conditioning and heating units were added to the list.
The maximum Sec. 179 deduction for 2016 is $500,000. The deduction begins to phase out dollar-for-dollar for 2016 when total asset acquisitions for the tax year exceed $200,010,000.
Real property improvements used to be ineligible. However, an exception that began in 2010 was made permanent for tax years beginning in 2016. Under the exception, you can claim a Sec. 179 deduction of up to $500,000 for certain qualified real property improvement costs.

Note: You can use Sec. 179 to buy an eligible heavy SUV for business use, but the rules are different from buying other assets. Heavy SUVs are subject to a $25,000 deduction limitation.

First-year bonus depreciation

For qualified new assets (including software) that your business places in service in 2016, you can claim 50% first-year bonus depreciation. (Used assets don’t qualify.) This break is available when buying computer systems, software, machinery, equipment, and office furniture.

Additionally, 50% bonus depreciation can be claimed for qualified improvement property, which means any eligible improvement to the interior of a nonresidential building if the improvement is made after the date the building was first placed in service. However, certain improvements aren’t eligible, such as enlarging a building and installing an elevator or escalator.

Contemplate what your business needs now

If you’ve been thinking about buying business assets, consider doing it before year end. This article explains only some of the rules involved with the Sec. 179 and bonus depreciation tax breaks. Contact us for ideas on how you can maximize your depreciation deductions.

 

© 2016

Top Benefits of Working with a Construction CPA

Top Benefits of Working with a Construction CPA

Not all CPAs are created equal when it comes to the construction industry. Did you know that the construction industry is unique in that it has its own Internal Revenue Code section?  In our profession we regularly see financial statements that don’t make sense because a generalist CPA didn’t understand the complex requirements of construction accounting. In fact, frequently a lack of industry specific knowledge can actually harm a company — from understating bonding capacity and working capital, improper indirect cost allocation, or miscalculated bank covenant ratios. These inquiries can result in increased credit costs and lost opportunities. Here are some of the top reasons you should be utilizing a CPA team that specializes in construction accounting and reporting:

  1. Income is correctly calculated on the percentage-of-completion method, which is mandated as a generally accepted accounting principle.
  1. The financial statements include required contract schedules as supplementary information.
  1. The contract schedules appropriately tie to the balance sheet and income statement. Financial statements must show completed job revenue and work in process revenue that ties to total contract revenue on the face of the income statement. The same goes for costs.
  1. Correct terminology and classifications are used throughout the financial statements, much of which is unique to the industry, such as billings in excess of costs and estimated earnings (overbillings), and costs and estimated earnings in excess of billings (underbillings).
  1. Losses on uncompleted contracts are recognized in full at the time it is determined there will be a loss on a job. This is, again, mandated by generally accepted accounting principles.  It also means that the financial pain of a loss is over and done with all at once, and not spread over the life of the contract, thereby prolonging further damage to financial ratios in future periods.
  1. Unique contractor disclosures are included with the financial statements, such as backlog, retentions receivable, contract billing status, significant profit fade or gain, contract claims, etc.
  1. An appropriate accounting method for tax purposes is selected to match the cash flow of the business. There can be many different tax accounting methods available to a contractor.

How do you evaluate a construction CPA?  A good construction-focused CPA firm should have a dedicated team that specializes in the industry led by a partner or shareholder with a Certified Construction Industry Financial Professionals (CCIFP) credential.  The firm should be a member of respected industry trade organizations, such as Associated Builders & Contractors (ABC), Associated General Contractors (AGC), and the Construction Financial Management Association (CFMA), just to name a few.   And lastly, the firm should have a large construction industry client base and provide value-added offerings in addition to tax and assurance services, such as benchmarking, financial ratio assessment, and succession planning.

Locating and identifying a construction CPA is one of the most crucial and rewarding decisions you can make for your business.  Once found, they should not only work with you to improve your business, but to improve the quality of financial information produced. A qualified construction CPA should support your ability to run a more profitable contracting business.

 

Sarah Shaw-Stahlke, CPA is a member leader of the Jones & Roth Construction TeamShe has expert knowledge in the construction industry and assists clients with financial reporting for bonding and banking purposes, job costing, financial ratios and benchmarking and tax planning. 

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“Accounting is really about people and building rewarding relationships.”

— Fritz Duncan, CPA, Partner & Shareholder

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