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T The Growing Impact of Social Media Use by Physicians and Their Employees By Neil Bhagat, Esq. HE IMPACT OF social media is often overstated, but consider this fact: 92% of state medical boards have received a report of online misconduct by a physician. Common complaints include inap- propriate patient communication, lying about credentials, use of discriminatory language or practices, and appearing intoxicated in photos. Of course, the fact that a complaint was made does not mean that there is any truth to it, but all physicians should be aware of the far-reaching implications of social media upon their practice – especially, because a recent study indicates that over 90% of physicians utilize social media. As a general primer, it is highly recom- mended that all physicians take a look at the American Medical Association's recently issued policy entitled Professionalism in the Use of Social Media. In brief, the new policy reiterates the importance of protecting patient confidentiality, including posting any identifiable patient information online; safeguarding a physician's own personal information; maintaining appropriate boundaries of the patient-physician relationship; notify- ing colleagues of unprofessional social media use, and; general awareness of the negative consequences online actions can have on your career. In addition to the use of social media by a physician, attention should be given to the use of social media by employees. It is critical that a social media policy be incor- porated into your employee handbook and that employees are aware of best practices for the use of social media as it relates to the workplace. It must be noted that the National Labor Relations Board has issued guidance indicating that communication amongst employees discussing a topic wh ich i s work-related and intended to prompt addit ional discussion among employees about workplace issues is considered protected activity and therefore, cannot be prohibited. However, incorporating best practices can ensure that employees are cognizant of the risks of social media and do not incur liability for the office. There is no doubt that there are many benefits to the use of social media, but physicians and their employees should ensure that thought is given to any work-related information posted online. Neil Bhagat is an at torney with A Should You Invest in Your Family or Friend's Business By Michael T. Livesay, CPA/PFS S YOU PROBABLY know, mixing family, friendships and money is likely to sour an otherwise good relationship. Yet, physicians are still a favorite target of family and friends looking for capital for their business venture. In their eyes, you earn a lot, so you must have extra cash available to "invest" with them. They are usually unaware of the delicate balance it takes for a physician to keep his or her financial house in order. They don't think about your declining Medicare and insurance reimbursements, your student loans, your malpractice premiums or the pressures you face to be a superior physician and advocate for your patients. If you talk to your colleagues, you are likely to find that most of them have had a bad experience investing in businesses with family or friends. The biggest reason it doesn't usually work is that those high investment returns you were promised never materialize, and the losses don't produce the tax savings you expected. If you choose to invest anyway, you should at least plan for the likely tax effects if your investment takes off or more importantly, if it fizzles. Will you pay taxes on the income? Will it be ordinary income or capital gains? Will you be able to deduct your losses? If so, when can you deduct your losses? Can the losses shelter your earnings, or do they get added to the pile of capital losses your CPA already tells you can't help you much unless you generate capital gains. 34 | Cleveland-Akron-Canton MD NEWS ■ MDNEWS.COM ■ JULY-AUGUST 2012 One thing that often trips physi- ? cians up when they are trying to deduct losses from small businesses is the dreaded passive loss rules. The passive loss rules were put in place to limit tax losses previously claimed by high income individuals and the real estate industry. These rules will most likely limit, or at least defer your losses on investments in real estate or other small businesses you don't work in. Real estate rentals are automatically passive unless you are a real estate professional (meaning you spend at least 750 hours per year in the real estate business) and investments in operating businesses are generally passive unless you materially participate (meaning you or your spouse work in that business at least 500 hours per year, not including administrative or bookkeeping work). These passive losses don't disappear, but are only allowed to be used to offset passive income or deducted entirely in the year you dispose of the business. If you have considered all of the above and still want to proceed, just remember to use common sense in choosing your investments and document your business arrangements and/or any loans in order to avoid problems in the future. Michael Livesay is a principal of Weidrick, Livesay, Mitchell & Burge, LLP in Akron. He is a CPA and a Personal Financial Specialist (PFS). ■ Buckingham, Doolittle & Burroughs, LLP, in Canton. He practices in the employment and labor law area. ■