Downey, Smith & Fier has served the healthcare industry’s sales and use tax needs for the past 16 years with the universal goal to improve compliance and ensure consistency application of tax.  

During this time, the industry has faced two major challenges: 1) applying outdated statutes and regulations to new products and emerging technology; and 2) constant changes in state policy and taxability of products with increased volume of products being only partial taxable.  These facts contribute to significant areas of non-compliance, including both over and underpayment of sales and use taxes, with the aggregate generally being a substantial overpayment.   

Opportunity: Hospitals should engage a Recovery Services firm to validate the tax billed and collected by its suppliers and pursue a refund of any overpaid tax.  

DSF represents hospitals, medical centers, clinics, device manufacturers, and other medical product retailers and distributors.   DSF works with all majority central supply distributors on a recurring basis to address areas of non-compliance on behalf of our clients.  States have a history of routinely and continuously auditing sellers for non-compliance, but audit generally only address untaxed products, ignoring products with tax collected.   

Opportunity: Distributors and sellers should perform comprehensive reviews of their product sales to include both underpayments and refunds during any audit period.  Offsets provide value to reduce the assessment, interest and penalties imposed.  

DSF provides the following specific services to support healthcare:

Recovery services (for hospitals/medical centers and sellers facing audit assessments) 

Audit assistance & support 

Product taxability determinations

Provider / seller product taxability reconciliation

Training & compliance support (decision tables, reference guides, etc.)