so why don't physician's change over to the accrual basis --- i had to write off about 32k last year in bad debt...

Zip Code: 02891

Physicians don't generally want to elect to be on the accrual method of accounting. When you elect accrual accounting, you're taxed on the accounts receivable at the end of the year. Yes, you do get to write off your payables, but for most medical offices I've seen, the A/R is much higher than the A/P.

And if you think of it, you are allowed to write off your bad debts. When you're on the cash basis of accounting, you just pay taxes on the money you receive. So if someone doesn't pay you, you essentially wrote off that receivable by never picking it up as income.

Zip Code: 01801