Services for Veterans

Question: Our community asked us to develop services for Iraq and Afghanistan returning veterans and their families. We renovated space in a facility, dedicated the space to let the community know it was available, and began an outpatient service line to care for this population. This work is supported by grants from our foundation and the VA.

  1. Can the care of these persons (physician and other clinical services) be reported as community benefit, or only the staff time spent to coordinate their care?
  2. Can we include the cost of the renovation as part of the community benefit?
  3. Can we include the costs associated with the dedication ceremony?

Recommendation:

  1. We recommend that the service be reported as a subsidized service because it was developed as a result of a documented community need and the costs must be subsidized. Be sure to subtract the cost of charity care, bad debt and losses from Medicaid and other means-tested government programs. You also have to subtract grants from the VA and any separately incorporated foundation as offsetting revenue, according to IRS instructions.
  2. The depreciation and interest costs of the renovation should be included as part of your costs for subsidizing the program.

If the primary purpose of the dedication ceremony was to publicize the availability of the community benefit service (and not primarily for marketing purposes), those costs can be reported as community benefit.

(Updated November 2015)

Please Take Note: The information provided does not constitute legal or tax advice. The material is provided for informational/educational purposes only. Please consult with counsel regarding your organization's particular circumstances.