From: SK Masood SKMasoodMD@...

End-of-Year Tax Tips

Dennis G. Murray, MA

  Nov 27, 2012 

 

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Introduction

Holiday season is a busy time of year; it's easy to get distracted. But now is also the time to start thinking about your finances -- specifically what moves you can make before December 31 that can save you money next year when you file your 2012 tax return.

We've identified 6 strategies that could save physicians big money come next April. Any one of them could be especially helpful to you if Congress can't get together to forestall several impending tax hikes that are slated to kick in next year. (For more on what could be on tap, see How the Tax Hikes Set for January 1, 2013, Will Affect You)

Some of these tips relate solely to your personal tax return, some pertain to physicians who own their practice and thus file a corporate return, and some could apply to either personal or corporate returns. We've noted this by adding a P for Personal or B for Business after each tip. Discuss each of them with your tax and financial advisors before going forward, as not every one may be right for your particular situation.

1. Plow more into your retirement plans. (P, B) While it's always smart to plan for your future, being more aggressive about saving takes on greater meaning in 2013, when 2 new Medicare taxes go into effect. (The money collected from the taxes is being used to fund the healthcare overhaul legislation passed in 2010.) Under the law, if you're married and file your tax return jointly, you'll pay an additional 0.9% if your wages, self-employment income, or other compensation (such as bonuses) exceeds $250,000, on top of the regular 1.45% Medicare tax. For single filers, this payroll tax limit is $200,000.

"Doctors who are self-employed will have to calculate this amount and report it on their tax return. If you're an employee, your employer will deduct it from each paycheck if it's certain you're going to be over the threshold," says Dora Hillyer, of Tobia & Hillyer Tax and Business Services, in Fairfield, New Jersey.

Married couples who will likely exceed the threshold won't escape the tax by filing separately; the amount will still be the same. "They could increase their federal withholding tax to avoid owing when they file, or else they just need to be aware that they'll owe the difference if one spouse is having the tax deducted from her paycheck and the other one isn't," says Larissa Grantham, a financial planner with Stepp & Rothwell, in Overland Park, Kansas

2. Dodge the new Medicare surtax. (P, B) Something as seemingly innocuous as the sale of a winning stock or a vacation home could trigger an additional 3.8% tax next year if your modified adjusted gross income, which includes earnings plus income from investments, exceeds $250,000 for couples and $200,000 for individuals.

For example, say a pediatrician and her husband have an adjusted gross income of $190,000 in 2013 and clear $125,000 on the sale of the waterfront cabin they bought for a song back in the 1990s. (The gain on the cabin is taxable because it's not from the sale of a principal residence.) Assuming the couple has no other investment income next year, the $315,000 in total income exceeds the threshold by $65,000 and is subject to regular income tax plus the 3.8% Medicare surtax.

If you anticipate some sizable taxable gains next year, increase your 2013 contributions to qualified tax-deferred retirement plans, like a 401(k) or SEP IRA, to shrink your adjusted gross income and help reduce the surtax or avoid it altogether. "Pre-tax contributions to retirement plans have an added benefit (against the surtax) in that they aren't counted as income on withdrawal," says Hillyer's partner, Bert Tobia. Distributions from Roth IRAs and tax-exempt municipal bond funds are also excluded from the surtax thresholds, Tobia adds.

Good Ideas for Saving on Taxes

3. Take some income early. (P, B) If the folks in Washington let the Bush-era tax cuts expire at the end of the year, tax rates on earned income (your salary, for instance) are going to jump at least 3 percentage points, and as many as 4.6 -- from 35% to 39.6% -- for those in the highest bracket. That means it might make sense to take certain taxable payments in 2012 instead of waiting until 2013, such as bonuses, honorariums for sitting on advisory boards, or, if you're a partner, income from the goodwill value of your practice or from cashing in stock options.

4. Trigger capital gains. (P) With the tax rate on long-term capital gains set to increase from 15% to 20% in 2013, now may be the time to sell some of your winning investments to lock in the lower rate. To use an example, if you sell $20,000 in shares of appreciated stocks that you've held for more than a year (Uncle Sam's definition of "long term") by December 31, you'll owe $3000 on your 2012 tax return. Cash them in after January 1, and you'll part with $4000.

Of course, this strategy assumes that it makes sense to sell. It may not, especially if the investment has "room to run" and its prospects for 2013 and beyond look promising. In short, don't sell for the sake of getting a tax break. If you're unsure of what to do, contact your accountant or financial advisor. One strategy he or she might suggest is to sell a winning investment before the end of the year, to lock in the lower capital-gains rate, then immediately buy it back again. However, there may be transaction costs to consider -- commissions, namely -- so those will need to be factored into any decision you make.

5. Invest in your practice. (B) Here's a great tax-advantaged move if you're in the market for some new or used diagnostic or business-related equipment: You can write off the full amount of any purchases you make this year, up to $139,000, which can reduce your 2012 tax bill substantially. (The deduction is reduced dollar for dollar on total purchases exceeding $560,000, however.) The IRS's definition of "equipment" extends to off-the-shelf computer software, which may spur you to add an electronic medical records system or upgrade an existing one. The nice thing, too, is that the tax breaks are on top of any government-funded incentives that may apply.

A bonus depreciation of 50% is available to practices that spend more than $560,000 on new purchases, but for every dollar you spend over that amount, your write-off shrinks by a dollar, as mentioned above. So for purchases of new equipment topping roughly $650,000, the tax benefit essentially disappears. Note, too, that the IRS specifies new purchases only are eligible for the bonus depreciation ; used or reconditioned equipment doesn't qualify.

Another thing to be mindful of: To be eligible for either the deduction or bonus depreciation allowance on your 2012 return, the IRS requires that the equipment be purchased and placed in service before December 31. So if you've been putting off any big expenditures, now's the time to get serious about making them, especially because the maximum deduction is expected to drop to just $25,000 in 2013.

6. Open your heart -- and your wallet. (P) Fans of the TV series Seinfeld will remember "The Human Fund," George Costanza's bogus charity to which his boss, Mr. Kruger, wrote a check for $20,000. Without getting into further plot details, the lesson here is that while donating to a favorite cause is a great way to trim your tax bill, first make sure the IRS recognizes the charity as one that's eligible to receive tax-deductible contributions. If it's not, your deduction will be disallowed and you'll owe back taxes and possibly penalties on the amount donated. Moreover, you'll need written confirmation from the charity to substantiate any donations worth more than $250.

The IRS has a search function on its Website to help you determine a charity's status:http://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check. Tip: You have to put quotation marks around the name of the charity (or part of its name) in order to pinpoint the organization precisely.

By the way, it turns out "The Human Fund" exists after all. Based in Chagrin Falls, Ohio, the charity has raised more than $1 million in support of arts programs for kids in the Cleveland area. And, yes, founder Andrew Rayburn confirms that he took the charity's name from the sitcom.

Conclusion

Talk with your tax preparer and your financial planner before initiating any of these strategies. You may find that one's not as good for you as you had anticipated, while others may confer a greater benefit than you had expected. The key is to start the conversation -- and complete the moves that make the best sense for you and your family -- well before you pop the bubbly and ring in the New Year.

 

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From: M.Raza Khan dowite@...

 

 Transplant Doctor, Nobel Winner Murray Dies

by The Associated Press

BOSTON (AP) — Dr. Joseph E. Murray, who performed the world's first successful kidney transplant and won a Nobel Prize for his pioneering work, has died. He was 93.

Murray suffered a stroke at his suburban Boston home on Thanksgiving and died at Brigham and Women's Hospital on Monday, hospital spokesman Tom Langford said.

Since the first kidney transplants on identical twins, hundreds of thousands of transplants on a variety of organs have been performed worldwide. Murray shared the Nobel Prize in Physiology or Medicine in 1990 with Dr. E. Donnall Thomas, who won for his work in bone marrow transplants.

"Kidney transplants seem so routine now," Murray told The New York Times after he won the Nobel. "But the first one was like Lindbergh's flight across the ocean."

Murray's breakthroughs drew criticism from some ethicists and religious leaders. Some people "felt that we were playing God and that we shouldn't be doing all of these, quote, experiments on human beings," he told The Associated Press in a 2004 interview in which he also spoke out in favor of stem cell research.

In the early 1950s, there had never been a successful human organ transplant. Murray and his associates at Boston's Peter Bent Brigham Hospital, now Brigham and Women's Hospital, developed new surgical techniques, gaining knowledge by successfully transplanting kidneys in dogs. In December 1954, they found the right human patients, 23-year-old Richard Herrick, who had end-stage kidney failure, and his identical twin, Ronald Herrick.

Because of their identical genetic background, they did not face the biggest problem with transplant patients, the immune system's rejection of foreign tissue.

After the operation, Richard had a functioning kidney transplanted from Ronald. Richard lived another eight years, marrying a nurse he met at the hospital and having two children.

Murray performed more transplants on identical twins over the next few years and tried kidney transplants on other relatives, including fraternal twins, learning more about how to suppress the immune system's rejection of foreign tissue. One patient who received a kidney transplant from a fraternal twin in 1959, plus radiation and a bone marrow transplant to suppress his immune response, lived for 29 more years.

But it was the development of drugs to suppress the body's immune response, a less radical approach than radiation, that made real breakthroughs in transplants possible. In 1962, Murray and his team successfully completed the first organ transplant from an unrelated donor. The 23-year-old patient, Mel Doucette, received a kidney from a man who had died.

Murray continued a long career in plastic surgery, his original specialty, and transplants. He was guided by his own deep religious convictions.

"Work is a prayer," he told the Harvard University Gazette in 2001. "And I start off every morning dedicating it to our Creator."

Murray told the Journal of the American Medical Association in 2004 that he continued to get letters from patients he helped years earlier and from relatives of those who died during the early efforts.

"They often say ... that they are happy to have played some small part in the eventual success of organ transplants," he said, praising the courage of his patients and their families.

Murray was honored at the 2004 Transplant Games, for athletes who have received organ transplants, along with Ronald Herrick, the man who had donated a kidney to his twin brother a half-century earlier.

Murray continued to support and mentor others at Brigham and Women's Hospital after his retirement, hospital president Dr. Elizabeth Nabel said. An exhibit in the hospital's library housing his Nobel Prize, she said, is framed by his own words: "Service to society is the rent we pay for living on this planet."

She said he joined in a Veteran's Day ceremony Nov. 12 at which he was among those honored for their military service.

Murray's interest in transplants developed during his time in the Army during World War II when he was assigned to Valley Forge General Hospital in Pennsylvania while awaiting overseas duty. The hospital performed reconstructive surgery on troops who had been injured in battle.

The burn patients, who often were treated with skin grafts from other people, intrigued Murray.

"The slow rejection of the foreign skin grafts fascinated me," Murray wrote in his autobiography for the Nobel Prize ceremony. "How could the host distinguish another person's skin from his own?"

The hospital's chief of plastic surgery had performed skin grafts on civilians and noticed that the closer the donor and recipient were related, the slower the tissue was rejected. A skin graft between identical twins had taken permanently.

Murray said that was "the impetus" of his study of organ transplantation.

Murray was ever the optimist and kept on his desk a quotation, "Difficulties are opportunities," his son Rick Murray said.

"It reflects the unwavering optimism of a great man who was generous, curious, and always humble," Rick Murray said in a statement released by the hospital.

Joseph Murray is survived by his wife, Bobby, five other children and 18 grandchildren.

                       

 

52^nd St Andrew's Day Festival Symposium                                                                          

RCPE Symposium Edinburgh

Date: Thursday & Friday 6^th -7^th December 2012

Venue: Classroom A & B, Shaukat Khanum Memorial Cancer Hospital & Research Centre Lahore

 

Dear All,

The Royal College of Physicians of Edinburgh (RCPE) is organizing 52nd St Andrew's Day Festival Symposium: Updates on Acute Medicine on Thursday & Friday, December 6 - 7, 2012. Shaukat Khanum Memorial Cancer Hospital and Research Centre (SKMCH&RC) will have this telecasted live. There is no fee for attendance at the SKMCH venue but pre-registration is required especially for outside participants.

Message from the Organizers

Here’s a great opportunity to brush up on your acute medicine skills. We’ll get up-to-date information on a wide variety of topics from heart failure to sepsis to anaphylaxis. This annual symposium will take place over a two-day period. It is hoped that these sessions on some extremely important topics will appeal to specialists and general internists alike.

Thursday 6th December 2012 (all times listed are Lahore times).
14.00	Registration
14.25	Welcome and Introductory Remarks by Dr Neil Dewhurst, President, Royal College of Physicians of Edinburgh
SESSION 1 - DIFFICULT PROBLEMS IN ACUTE MEDICINE Chair: Dr Michael C Jones, Acute Physician, University Hospital of North Durham & Vice President, Royal College of Physicians of Edinburgh
14.30	Dealing with coagulation problems in acute medicine Dr Roderick Neilson, Consultant Haematologist, Forth Valley Royal Hospital, Larbert
15.00	The hot joint Dr Philip Riches, Consultant Rheumatologist, Western General Hospital, Edinburgh
15.30	Delirium versus dementia in acute care Professor Emma Reynish, Professor of Dementia Research, University of Stirling & Consultant Physician, NHS Fife
16.00	Coffee / Tea
Session 2 - Investigations and therapies Chair: Dr Dan Beckett, Consultant Acute Physician & Clinical Lead for Acute Medicine, Forth Valley Royal Hospital, Larbert
16.30		Acute neuro-radiology for physicians Dr David Summers, Consultant Neuro-Radiologist, Western General Hospital, Edinburgh
17.00		Fluid replacement – uses and abuses Mr Dileep Lobo, Professor of Gastrointestinal Surgery, University of Nottingham
17.30		Hi-Tea
18.00- 18.45		RCPE Annual Meeting (for Fellows and Members only)

Session 3 - Cardiology

Chair: Professor David Bowen Jones, Consultant Physician, Wirral University Teaching Hospital NHS Foundation Trust

18.45	Does the ECG still have a role in acute medicine? Dr Edward Rowland, Consultant Cardiologist, The Heart Hospital, London
19.15	Cardiac failure revisited Dr Mark Petrie, Consultant Cardiologist, Director of the Scottish National Heart Failure Service, Golden Jubilee National Hospital & Honorary Reader, Glasgow University
19.45	Symposium feedback / tea

                Session 4 - Future challenges

                Chair: Dr Neil Dewhurst, President, Royal College of Physicians of Edinburgh

20.15	What’s next for the health of society? Professor Phil Hanlon, Professor of Public Health, University of Glasgow
20.45	STANLEY DAVIDSON LECTURE - via live videolink Chair: Dr Neil Dewhurst,President, Royal College of Physicians of Edinburgh Building quality and safety into acute medicine Professor Robert Wachter, Professor of Clinical Medicine UCSF Medical Center, San Francisco
21.30	Close
Friday 7th December 2012

Session 1 - Difficult problems in acute medicine

Chair: Dr Sian Finlay, Consultant Physician, Dumfries & Galloway Royal Infirmary

14.30	Legal aspects of acute medical care Dr Stephen Potts, Consultant Psychiatrist, Royal Infirmary of Edinburgh
15.00	Hyponatraemia Professor Chris Thompson, Consultant Endocrinologist, Beaumont Hospital, Dublin
15.30	HIV on acute take Dr Michael E Jones, Consultant Physician, Western General Hospital, Edinburgh
16.00	Coffee / tea

Session 2 - Identifying and managing acute illness

Chair: Dr Neil Dewhurst, President, Royal College of Physicians of Edinburgh

16.30	Early recognition and management of sepsis Dr Ron Daniels, Consultant in Critical Care Medicine, Good Hope Hospital, Sutton Coldfield
17.00	JAMES CAMERON LECTURE Chair: President, Royal College of Physicians of Edinburgh Early Warning Scores Professor Gary Smith, Visiting Professor, Centre of Postgraduate Medical Research & Education, School of Health & Social Care, University of Bournemouth
17.45	Hi-Tea

Session 3 - Clinical cases that changed my practice

Chair: Dr Alistair Dorward, Consultant Physician, Royal Alexandra Hospital, Paisley

18.30	Three senior clinicians describe cases that caused them difficulty and which influenced their practice - Dr Nick Boon, Consultant Cardiologist and Honorary Reader, University of Edinburgh - Professor Christopher Isles, Consultant Physician, Dumfries & Galloway Royal Infirmary - Dr John Wilson, Consultant Physician, Victoria Hospital Kirkcaldy
19.40	Symposium feedback / tea

Session 4 - Difficult problems in acute medicine

Chair: Dr Alastair MacGilchrist, Consultant Physician, Royal Infirmary of Edinburgh

20.10	Acute gastro-intestinal bleeding Dr Kel Palmer, Consultant Gastroenterologist, Edinburgh
20.40	Is it all just yellow, swollen and bleeding? when to worry about liver disease Dr Stephen Ryder, Consultant Hepatologist, University Hospital, Nottingham
21.10	Anaphylaxis and urticaria Dr Malcolm Shepherd, Honorary Clinical Associate Professor, University of Glasgow
21.40	Close