Retirement Homes to Pay Higher Taxes

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The IRS intends to collect on the billions of dollars of taxes that come from entrance fees retirement homes charge to the elderly who use their services. Some of these retirement homes are profit making organizations whereas others are non profits. For those that are profit making ones, they are taxed on their entrance fees themselves. For those that are non profit making, they are taxed on income derived from their entrance fees like fixed deposit interests.

Two cases in point are the Classic Residence by Hyatt which is a profit making retirement home and the Mission Ridge, a nonprofit retirement home. In both cases, the likely effect of taxation on their entrance fees and derived income will be an increase in their fees to the retirees who use the facilities. Generally, these homes can charge entrance fees anywhere from $250,000 to $2 million. This fee is generally refundable when the retirees leave the homes either through death or moving to another location.

Please see full article below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Darrin Mish, Tampa Tax Attorney, The Law Offices of Darrin Mish, P.A. | Attorney Advertising

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