Oregon Office of Rural Health

Rural Practitioner Tax Credit for MDs and DOs

Rural Practitioner Tax Credit for M.D.s and D.O.s

Eligibility Criteria

The definitions below reference eligible hospitals and geographic rural areas.

  • If an MD or DO is on active staff with a hospital, it must be one of the eligible hospitals for this program. Those eligible hospitals are either state Type A, B, exceptional C, or federal Critical Access Hospital (CAH).

    If a hospital is a Type B, it cannot be located in a Metropolitan Statistical Area (MSA). Oregon’s MSAs include Multnomah, Clackamas, Washington, Polk, Yamhill, Marion, Lane, Deschutes, Columbia, Benton, Linn, Josephine, and Jackson counties. There is an inclusion allowance for Type B hospitals in an MSA, which are also 30 or more miles from the major population center in the MSA, or if a Type B is in a county of fewer than 75,000 population. Currently PeaceHealth Peace Harbor in Florence is the only Type B that meets this criteria.

  • MDs or DOs who are not on the medical staff of any Oregon hospital, but whose practice is rural.
  • MDs or DOs on the staff of an ineligible hospital, but whose practices are located outside the immediate service area of the community where the hospital is situated, whose practice locations are deemed rural by the Oregon ORH.
  • MDs or DOs on staff at a rural hospital that was designated a rural referral center by the federal government before January 1, 1989, and that serves a community with a population of at least 14,000 but not more than 19,000. This applies only to Bay Area Hospital in Coos Bay and became effective on January 1, 2014. It does not apply to previous amendable tax years.
  • Must provide a minimum of 20 hours per week of patient care, averaged over the month in a eligible rural area.
  • Eligible MDS and DOs must attest to being willing throughout the tax year to serve patients with Medicare and Medicaid coverage. The practitioner must accept patients insured by Medicare and Medicaid until his/her patient panel reaches a threshold of 20 percent Medicare and 15 percent Medicaid, or the same percentage as in the county population if that percentage is less.
  • Practitioners who have spent a partial year practicing in a rural area may be eligible for a pro-rated tax credit.
  • Once a practitioner is certified, the eligibility may be renewed each year if the practice site remains in an eligible area. Renewal forms are mailed automatically every January to the recipient's home address.
  • Each application must be accompanied by a $45.00 processing fee.

The definitions below reference eligible hospitals and maximum credit tiers (represented as a spreadsheet Excel | PDF, and as a map).

  • If an MD or DO is on active staff with a hospital, it must be one of the eligible hospitals for this program. Those eligible hospitals are either state Type A, B, exceptional C, or federal Critical Access Hospital (CAH).

    If a hospital is a Type B, it cannot be located in a Metropolitan Statistical Area (MSA). Oregon’s MSAs include Multnomah, Clackamas, Washington, Polk, Yamhill, Marion, Lane, Deschutes, Columbia, Benton, Linn, Josephine, and Jackson counties. There is an inclusion allowance for Type B hospitals in an MSA, which are also 30 or more miles from the major population center in the MSA, or if a Type B is in a county of fewer than 75,000 population. Currently PeaceHealth Peace Harbor in Florence is the only Type B that meets this criteria.

  • MDs or DOs who are not on the medical staff of any Oregon hospital, but whose practice is rural.
  • MDs or DOs on the staff of an ineligible hospital, but whose practices are located outside the immediate service area of the community where the hospital is situated, whose practice locations are deemed rural by the Oregon ORH.
  • MDs or DOs on staff at a rural hospital that was designated a rural referral center by the federal government before January 1, 1989, and that serves a community with a population of at least 14,000 but not more than 19,000. This applies only to Bay Area Hospital in Coos Bay and became effective on January 1, 2014. It does not apply to previous amendable tax years.
  • Must provide a minimum of 20 hours per week of patient care, averaged over the month in a eligible rural area.
  • MDs and DOS must attest to being willing throughout the tax year to serve patients with Medicare and Medicaid coverage. The practitioner must accept patients insured by Medicare and Medicaid until his/her patient panel reaches a threshold of 20 percent Medicare and 15 percent Medicaid, or the same percentage as in the county population if that percentage is less.
  • There are now tiers that dictate the maximum possible tax credit amount.  Those tiers are as follows based upon the location of your practice site:

    If an eligible practitioner meets the criteria of more than one tier, the maximum possible credit would be that of the higher tier.

    • Tier 1: 10-20 miles from the centroid of a community with a population of 40,000 or more = $3,000
    • Tier 2: 20-50 miles from the centroid of a community with a population of 40,000 or more = $4,000
    • Tier 3: 50+ miles from the centroid of a community with a population of 40,000 or more = $5,000
  • Practitioners who have spent a partial year practicing in a rural area may be eligible for a pro-rated tax credit.
  • Once a practitioner is certified, the eligibility may be renewed each year if the practice site remains in an eligible area. Renewal forms are mailed automatically every January to the recipient's home address.
  • Each application or renewal form must be accompanied by an annual $45.00 processing fee.

The definitions below reference eligible hospitals and maximum credit tiers (represented as a spreadsheet Excel | PDF, and as a map). Bolded lines are new rules beginning tax year 2018.

  • If an MD or DO is on active staff with a hospital, it must be one of the eligible hospitals for this program. Those eligible hospitals are either state Type A, B, exceptional C, or federal Critical Access Hospital (CAH).

    If a hospital is a Type B, it cannot be located in a Metropolitan Statistical Area (MSA). Oregon’s MSAs include Multnomah, Clackamas, Washington, Polk, Yamhill, Marion, Lane, Deschutes, Columbia, Benton, Linn, Josephine, and Jackson counties. There is an inclusion allowance for Type B hospitals in an MSA, which are also 30 or more miles from the major population center in the MSA, or if a Type B is in a county of fewer than 75,000 population. Currently PeaceHealth Peace Harbor in Florence is the only Type B that meets this criteria.

  • MDs or DOS who are not on the medical staff of any Oregon hospital, but whose practice is rural.
  • MDs or DOs on the staff of an ineligible hospital, but whose practices are located outside the immediate service area of the community where the hospital is situated, whose practice locations are deemed rural by the Oregon ORH.
  • MDs or DOS on staff at a rural hospital that was designated a rural referral center by the federal government before January 1, 1989, and that serves a community with a population of at least 14,000 but not more than 19,000. This applies only to Bay Area Hospital in Coos Bay and became effective on January 1, 2014. It does not apply to previous amendable tax years.
  • Must provide a minimum of 20 hours per week of patient care, averaged over the month in a eligible rural area.
  • Has adjusted gross income (filing individually or jointly) not in excess of $300,000 for the tax year. The limitation in this paragraph does not apply to a physician who practices as a general surgeon, specializes in obstetrics or specializes in family or general practice and provides obstetrical services.
  • Eligible MDs and DOs must attest to being willing throughout the tax year to serve patients with Medicare or Medicaid coverage. The practitioner must accept patients insured by Medicare or Medicaid until his/her patient panel reaches a threshold of 20 percent Medicare and 15 percent Medicaid, or the same percentage as in the county population if that percentage is less.
  • There are now tiers that dictate the maximum possible tax credit amount. Those tiers are as follows based upon the location of your practice site:

    If an eligible practitioner meets the criteria of more than one tier, the maximum possible credit would be that of the higher tier.

    • Tier 1: 10-20 miles from the centroid of a community with a population of 40,000 or more = $3,000
    • Tier 2: 20-50 miles from the centroid of a community with a population of 40,000 or more = $4,000
    • Tier 3: 50+ miles from the centroid of a community with a population of 40,000 or more = $5,000
       
  • The program's sunset date is December 31, 2021. Should the program be discontinued at that time, a taxpayer who meets the eligibility requirements for tax year 2021, could be allowed the credit through tax year 2030, as long as they maintain all eligibility requirements.
  • An eligible taxpayer may not claim the credit for more than a total of 10 tax years beginning on or after January 1, 2018.
  • Practitioners who have spent a partial year practicing in a rural area may be eligible for a pro-rated tax credit.
  • Once a practitioner is certified, the eligibility may be renewed each year if the practice site remains in an eligible area. Renewal forms are mailed automatically every January to the recipient's home address.
  • Each application or renewal form must be accompanied by an annual $45.00 processing fee.

The definitions below reference eligible hospitals and maximum credit tiers (represented as a spreadsheet (Excel | PDF), and as a map). Bolded lines are new rules beginning tax year 2020.

  • If an MD or DO is actively practicing in and a member of the medical staff staff with a hospital, it must be one of the eligible hospitals for this program. Those eligible hospitals are:
    • State Type A 
    • State Type B (unless located in a Metropolitan Statistical Area) 
    • State Type Exceptional C 
    • Federal Critical Access Hospital (CAH) 
    • Federal Sole Community Hospital 
    • Federal Rural Referral Center 
  • MDs or DOS who are not on the medical staff of any Oregon hospital, but whose practice is rural.
  • MDs or DOs on the staff of an ineligible hospital, but whose practices are located outside the immediate service area of the community where the hospital is situated, whose practice locations are deemed rural by the Oregon ORH.
  • Must provide a minimum of 20 hours per week of patient care, averaged over the month in a eligible rural area.
  • Has adjusted gross income (filing individually or jointly) not in excess of $300,000 for the tax year. The limitation in this paragraph does not apply to a physician who practices as a general surgeon, specializes in obstetrics or specializes in family or general practice and provides obstetrical services.
  • Eligible MDs and DOs must attest to being willing throughout the tax year to serve patients with Medicare or Medicaid coverage. The practitioner must accept patients insured by Medicare or Medicaid until his/her patient panel reaches a threshold of 20 percent Medicare and 15 percent Medicaid, or the same percentage as in the county population if that percentage is less.
  • There are tiers that dictate the maximum possible tax credit amount. Those tiers are as follows based upon the location of your practice site:

    If an eligible practitioner meets the criteria of more than one tier, the maximum possible credit would be that of the higher tier.

    • Tier 1: 10-20 miles from the centroid of a community with a population of 40,000 or more = $3,000 
    • Tier 2: 20-50 miles from the centroid of a community with a population of 40,000 or more = $4,000 
    • Tier 3: 50+ miles from the centroid of a community with a population of 40,000 or more = $5,000
    •  

  • The program's sunset date is December 31, 2021. Should the program be discontinued at that time, a taxpayer who meets the eligibility requirements for tax year 2021, could be allowed the credit through tax year 2030, as long as they maintain all eligibility requirements.
  • An eligible taxpayer may not claim the credit for more than a total of 10 tax years beginning on or after January 1, 2018.
  • Practitioners who have spent a partial year practicing in a rural area may be eligible for a pro-rated tax credit.
  • Once a practitioner is certified, the eligibility may be renewed each year if the practice site remains in an eligible area. Renewal forms are mailed automatically every January to the recipient's home address.
  • Each application or renewal form must be accompanied by an annual $45.00 processing fee.

How to Apply

Request an application from Eric Jordan: jordane@ohsu.edu. Please specify in your request:

  • Your licensure type: MD, DO, NP, PA, CRNA, DPM, DMD, DDS, or OD
  • Where it is that you practice in Oregon (example: Columbia Memorial Hospital, Astoria)
  • When it was that you began practicing at the above site/s

Application timeline

You can expect to receive confirmation of your eligibility within six weeks (but probably sooner) during the months of January, February, and March and within two weeks the rest of the year.

Maps

The ORH offers a map of all Rural Practitioner Tax Credit Recipients throughout the state, as well as one highlighting just Physicians.

Questions?

Contact Eric Jordan: jordane@ohsu.edu | 503-494-4451 | 866-674-4376, but remember that we cannot make a determination on your application until we receive and review it.