Corporation Can’t Deduct Rent Paid to Corporation’s Sole Owner Doctor and Employee

Written by Reed Tinsley | February 13, 2018

Christopher C.L. NG MD, Inc. APC v. Comm'r, T.C. Memo. 2018-14, the Tax Court held that a corporation, solely owned by a doctor who was also the corporation's sole employee, could not deduct expenses relating to the purported rental of part of the doctor's home. In reaching its decision, the court relied on the fact that the corporation did not produce any evidence of a written rental agreement or other documentation to support its position that the amounts claimed were actually rent and the fact that the doctor also did not treat the arrangement with the corporation as a bona fide rental arrangement because he did not report any reciprocal rental income on his Schedules E for the years at issue.

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.

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