Health Providers' New Compensation Deduction Limit

Law360, New York (December 17, 2010, 2:02 PM EST) -- The Patient Protection and Affordable Care Act included a little-discussed provision limiting the compensation deduction allowable for “health insurance providers.” Significantly, the definition of “health insurance provider” under this provision is so broad that this limit likely will catch many companies by surprise.

The new compensation deduction limit, which is codified in new Section 162(m)(6) of the Internal Revenue Code of 1986, as amended (the code), generally limits the deduction allowable for compensation paid to a service provider by certain health insurance providers (and their related...
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