4 ms·

Not to mention that NP doesn’t prevent certain administrative and executive employees from getting excessive salaries.

• AnthonyMouse 3y ago
  But then they pay personal income tax on the salaries. Which is the same thing that would happen to the equipment supplier. You're in no way avoiding the tax, you're just having the equipment supplier pay it on their profits.
  • nobodyandproud 3y ago
    Not at all. The tax rates aren’t the same and non-profits aren’t forbidden from hiring businesses for contracts, pooling money, buying property, nor securing loans. It’s a good model for small NPs. It’s rife for large scale corruption at the scale of hundreds or thousands of employees. The point is that we see executive salaries for NPs that match salaries for for-profits. That indicates a broken system.
    • AnthonyMouse 3y ago
      > The tax rates aren’t the same At anything that could be considered a "high" salary, the personal income tax rates are higher than the corporate rates. Also, they would be exactly the same if the for-profit entity was an LLC or some other passthrough entity. > non-profits aren’t forbidden from hiring businesses for contracts, pooling money, buying property, nor securing loans. Neither are for-profit businesses. And then any businesses they hire would also be paying taxes on their profits. > The point is that we see executive salaries for NPs that match salaries for for-profits. That indicates a broken system. It indicates that the cost of hiring someone who knows how to run a hospital is the same regardless of whether you separately pay profits to shareholders.