Is That Deductible? Re-Entry

Return From The South Pacific

A recent Medical Economics article “Hey doc: you need to take more vacation time” was a great reminder to me of the importance of taking time off. I have always been a big fan of a “work hard and play hard” approach to my life—having routinely taken 4-5 weeks off every year. In fact, I am just getting back from a 3 week international CME that I described in last week’s post—but that trip marked my first time taking a full 3 weeks off—and I loved it!

However, just around the bend, my return to work was waiting.

Re-entry

Some of you may dread stress of re-entry after time away. If we're brutally honest, the extra workload before and after time off can make us wonder if it's really worth it. If you provide continuity of care or work non-shift hours, you will understand what I am talking about. I have always said that time off for primary care doctors doesn't mean someone else does your work; it simply means your workload gets shifted to other days outside of your time off.

Returning to work after my extended hiatus was both refreshing and challenging for me. The sudden transition from leisure to a structured routine always presents obstacles. Managing emails, tackling piled-up tasks, and getting back into work mode can feel overwhelming. This is especially true for me as I also juggle 9 micro-businesses along with caring for a large family with aging parents.

As I settled back into my home routine, I hit the ground running, focusing on what I do best: checking off tasks and getting things back on track. This also involved diving into new projects that emerged from three weeks of uncluttered thinking. This mental clarity allowed me to prioritize and organize some crucial business goals, which I decided should be outsourced. After exploring various options like Fiverr and Upwork, I ultimately selected Upwork to post my job(s).

Upwork

I created two jobs: a marketing job for SimpliMD and a new business full-stack startup job. This resulted in over 20 quality proposals for the marketing job, which had to be sorted through. I then conducted interviews with the top 5 candidates via Zoom. Luckily, I was able to quickly narrow it down and select a graduate marketing student from Portugal. I am excited to have the extra help as I work on developing our online community. Hopefully, you will notice the improvements over the next several months!

My other job was to create a full stack minimal viable product (MVP) for my business start-up . I was both excited and shocked by the sheer number of legitimate proposals I received from around the world, including physicians from Europe and South America. In fact, in addition to the UpWork site, contractors reached out to me via email, social media, phone, and text messaging. Once again, I found myself working through multiple meetings in the early hours of the morning and late nights due to the time differences with the international contractors. After choosing my contracting agency, I scowered the NDA and contract proposal with my corporate attorney on Friday, and received the green light to move forward. Stay tuned for more updates on this exciting startup that has the potential to disrupt the US marketplace.

4 Months Away

With only 4 months left before retiring from my current rural primary care position, I am preparing my patients for the transition. They have been thoughtful, bringing me gifts and love notes for their "last visit." Fortunately, I have two fantastic NPs who will be taking over for me. Despite two years of recruiting efforts, our hospital still hasn't been able to find a doctor willing to come to our small town. It's disheartening. I have scheduled a meeting with the administration to discuss their plans for ensuring access to care for my patients in our community. Managing my professional plans is the easy part of retirement as jobs are plentiful, but ensuring that the citizens of my community have local access to quality care remains a priority for me. I had two excellent young doctors in my clinic until our hospital closed its OB unit less than a year ago, prompting them to relocate to a nearby hospital that still offers maternity care. In addition to my retirement, another long-time primary care doctor in our community is also retiring this summer. Losing four physicians in less than a year is a significant blow to our rural community, especially considering the challenges we face in recruiting new healthcare providers.

On a happier note, I am excited to start organizing my post-retirement plans in July. This will involve a strategic planning meeting for our micro-business in Maui to finalize the direction my wife and I will take. What a great place for a business meeting!

In regard to future plans, I have been interviewing and exploring locum opportunities from August through the end of October (we’re going to Egypt in November). It has been quite a process, but I have decided that I would like to continue utilizing my FP-surgical obstetrical skills in a rural setting that values them. I am exploring all options, and it's quite enjoyable to think about.

Triathlons

I also plan to dedicate my free time to getting back into doing triathlons. While I have been running about 12-15 miles weekly for years, I have not participated in a triathlon for nearly a decade. I truly enjoy the cross-training aspect of triathlons, although it can be time-consuming. During my time delivering babies, it was challenging to keep up with triathlons. As part of the process, I took my old (1999) Trek road bike out and brought it to the bike shop to get it serviced and ready for the road again. They chuckled and remarked, "The new equipment is far superior to this. You should consider getting a new one - the repairs and upgrades will be almost as expensive as purchasing a new one." Intrigued, I decided to upgrade and ended up purchasing an Italian 3T gravel bike. This hybrid model is ideal for triathlons, trail biking, and will be perfect for my locum travels and the combined leisure and business interests at our STR in South Haven, Michigan.

Furnace Issue

A couple of my children were coming back to town to catch up and hear about our big trip to Australia and New Zealand. We have a guest house where they stay when they visit, which is a separate LLC. The night before their arrival, we were preparing the house and noticed that the furnace had broken, leaving the place at 47 degrees. Luckily, our HVAC contractor is a patient of mine and after an early morning text, he came over immediately to fix it. In the world of real estate, it’s so helpful and important to have a contractor network that is reliable and responsive!

Mom

About four months ago, my father passed away, and since then, I have been assisting my mom in settling her estate, managing her finances, and adjusting to living alone. Transitioning to living alone after nearly 60 years of marriage is challenging on its own, but dealing with progressive Parkinson's disease adds another layer of difficulty. Additionally, she has mysteriously developed significant reactive hypoglycemia, leading to mental status changes and requiring visits from EMTs to her home. Living alone, about 20 minutes from my home, makes the situation even more precarious. Last week, her condition worsened to the point where I had to stay overnight to ensure her safety. She was referred to an endocrinologist for a consultation, but that won’t happen for another 4 months due to a regional shortage of specialists. Therefore, I have taken on the task of supporting and educating her about a reactive hypoglycemic diet. This situation has reminded me of the expression “you can’t teach an old dog new tricks” because my mom, a retired nurse, is struggling to grasp the concept of complex carbohydrates and changing her eating habits.

The MOB

I own my medical office building in an LLC and lease it to the hospital for my practice. It's a great source of $100,000 in annual side income for me. After over a decade of ownership, I decided it was time to get the business name placed on the gas company account for the building, rather than my personal name. I figured it should be a quick phone call, and I was wrong! Unfortunately, I had to create a new business account and place a $3,700 deposit that would be refunded after 24 consecutive payments - frustrating! I also needed corporate documents to prove ownership and legitimacy, including the original EIN document for the company. The good news is that I am very diligent with record keeping. The challenge is that my previous accountant, who is no longer available, had the document. Thus, I had to call the IRS to get a copy. Poised to be on hold for 4 hours, I was shocked to get through in less than 10 minutes. They quickly identified the needed document from me. But then came the interesting part: they gave me two options for receiving it. I could either have it mailed by US mail, which would take 2 weeks, or they could fax it to me immediately. However, they couldn't email it to me as it wasn't considered secure enough. To receive the fax, I had to be next to a fax machine for security reasons. I decided to use both options they provided. However, to send the fax, I needed to drive to my clinic, call the IRS again (with a 15-minute wait time), have them fax it, and finally, I received it! Next, I had to upload the document to the gas company. Lastly, I have to wait for the gas company to call me within 2 business days to verify everything. What a hassle just to pay my utility bill in the business's name.

The Refrigerator

The final task was getting my 2-year-old refrigerator fixed. While attending our CME, our adult children who live at our home contacted us to inform us that the refrigerator was not working. Additionally, I knew that the ice-maker had not been functioning correctly for about 6-9 months. Several months ago, when I contacted the Sears service technician to inspect the ice-maker, the repair cost was almost as much as a new refrigerator, so I decided against it. Fortunately, the "reboot method" of unplugging and re plugging the fridge worked to restart the refrigerator while we were away. Now it was time for me to assess the underlying problem. I knew that calling Sears again would not be helpful, and I really didn’t want to spend over $3000 on a new fridge. So, I called my "fix-it-all" cousin and uncle to come help diagnose and fix the problem. I was filled with optimism because they had repaired my mom’s fridge just one month earlier. We took the thing apart, found the issue with the "motherboard" (it’s always the electronics and not the mechanics). I ordered the parts on Amazon and planned to follow YouTube tutorials to fix it myself. My cousin and uncle refused any payment and were happy just to make a visit at “the doctor’s house”.

Guess what? After performing all that diagnostic work, the fridge is now working perfectly, and the ice-maker is functioning flawlessly - all before I replaced the motherboards. Now I have to decide whether I will still go ahead and replace them or not. The parts are sitting on my desk, ready for me to hit the "return" button on Amazon. I love the convenience of being able to do this with Amazon!

Is It Deductible?

Now, let's address the burning question about the business purpose behind the unique situations I encountered last week. Remember, if you are a micro-business owner, your goal is to identify the two main objectives of expenses that come into your life:

1. Use pre-tax dollars to pay for things, rather than post-tax dollars

2. Use business dollars to cover expenses rather than post-tax household dollars

The Week’s Events

• Primary Job Re-Entry: No dollars involved, other than the the normal overhead expenses of operating my PC

• International CME: deductible

• SimpliMD Marketing Contractor: deducible

• Business Start-Up Contractor: deductible

• PC Strategic Planning Meeting in July: deductible

• Locums Exploration: time associated is not deductible, but all costs associated with preparation and doing the work will be deductible

• New Gravel Bike: to be determined, will consult with our tax professional as the business purpose may fall under one of our businesses

• Furnace Repair at Guest House: deductible expense to the guest house LLC

• Medical Care for my Mother: not deductible, just sharing the love for family since she “paid it forward” all of those years in my life

• Medical Office Building Utility Deposit: deductible business expense to the MOB LLC, and will be a pass through expense connected to the triple net lease—thus the hospital ultimately pays for it

• Refrigerator Repair: not deductible since it was a personal item. BUT I used points earned from my business credit cards to order the parts on Amazon. Thus it was a household expense that cost me nothing

If you are using your post-tax W-2 dollars to pay for expenses in your life, you may be missing out on the secrets known to physicians who own micro-businesses. Not only are you paying $80,000 to $100,000 in federal taxes annually, but on top of this, your expenses come out of your personal pocket.

Micro-business owners pay about half this amount in federal taxes, all while having many of their expenses covered through legitimate business purposes. Remember, your individual life and professional life are closely intertwined in a micro-corporation.

Want to know more about how you could start your micro-corporation and flow your business expenses through it? Contact me here for an inexpensive micro-business consultation.