Section of Taxation Publications
  VOL. 54
NO. 1
FALL 2000
Contents | TTL Home

 Note: The following is an excerpt from the introduction to the article as published in The Tax Lawyer. Author citations have been omitted for brevity. Tax Section members may read the article in its entirety in Adobe Acrobat format.

Cash Method of Accounting for Professional Health Services Corporations: Osteopathic Medical Oncology and Hematology, P.C. v. Commissioner

Lisa DeMarchi Sleigh


In Osteopathic Medical Oncology and Hematology, P.C., v. Commissioner, the Tax Court held that the taxpayer could use the cash method of tax accounting to expense drugs when the drugs are used as an indispensable and inseparable part of the rendering of chemotherapy services and the provision of drugs is subordinate to the provision of services.

Part I of this Note summarizes the facts of Osteopathic Medical. Part II discusses the arguments for both parties. Part III describes the Tax Court’s majority and dissenting opinions. Part IV critiques the court’s analysis and argues that the holding should not be extended to similar service providers.


Published by
Section of Taxation, American Bar Association
With the Assistance of
Georgetown University Law Center


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