Osteopathic Med. Oncology & Hematology, P.C. v. Commissioner
United States Tax Court
P, a professional service corporation, specializes in the treatment of cancer through chemotherapy. P uses drugs and ancillary pharmaceuticals (collectively, the drugs) during its treatment. The chemotherapy treatments are prescribed by P's professional staff, and patients do not select the type or quantity of drugs used during the treatments. P uses the cash method to expense the cost of the drugs.
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P, a professional service corporation, specializes in the treatment of cancer through chemotherapy. P uses drugs and ancillary pharmaceuticals (collectively, the drugs) during its treatment. The chemotherapy treatments are prescribed by P's professional staff, and patients do not select the type or quantity of drugs used during the treatments. P uses the cash method to expense the cost of the drugs. R determined that the drugs were "merchandise" under sec. 1.471-1, Income Tax Regs., and that P must use an accrual method to report all amounts attributable to the drugs. HELD: The inherent…
1Opinion of the Court
OPINION
Laro, Judge:
The parties submitted this case to the Court without trial. See Rule 122. Petitioner petitioned the Court to redetermine respondent’s determination of a $50,515 deficiency in its 1995 Federal income tax. The sole issue for decision is whether petitioner, a professional service corporation, may use the cash receipts and disbursements method (cash method) to expense the drugs and ancillary pharmaceuticals (collectively, chemotherapy drugs) used by it while providing chemotherapy treatments to its patients. We hold it may. Unless otherwise stated, section references are to the…
2Cases cited15 opinions
- Thor Power Tool Co. v. CommissionerSupreme Court of the United States · 1979
- Abbott Laboratories v. Portland Retail Druggists Assn., Inc.Supreme Court of the United States · 1976
- Knight-Ridder Newspapers, Inc. v. United StatesCourt of Appeals for the Eleventh Circuit · 1984
- Commissioner v. Asphalt Products Co.Supreme Court of the United States · 1987
- Prabel v. CommissionerUnited States Tax Court · 1988
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