Legal Question in Consumer Law in California
In settlement between a Doctor (Tenant) and Medical office building ( Landlord) , Medical office building provided the Doctor a moving allowance in the amount of $ 75,000. Is the $ 75,000 paid to the Doctor, ( Tenant), fully taxable in the Doctor's income tax return???
1 Answer from Attorneys
1. This is not a consumer law question; it is a tax question. 2. Although it could be answered by a tax attorney, this is not really a legal question; it is a question for a tax accountant.
With those caveats, however, as the owner of a small professional practice myself, here's how I would treat it. In that situation presumably the move would be costing more than $75,000 since the payment is a "settlement." Accordingly I would book the move as a reimbursable expense, and book the payment as a partial reimbursement. Then I would include the balance of the moving expense as an uncollectible reimbursable expense in my deductible business expenses for the year.
Hope that helps, but you really should ask an accountant.
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