- 38 - in two different ways. Although the Black Motor formula is a conceivable method for calculating the Uncollectible Amount, and perhaps even a better choice, it is not the only possible method, and it is not even one of the two versions of the formula that is described in H. Rept. 99-426, supra at 608, 1986-3 C.B. (Vol. 2) at 608. Under the circumstances, we must defer to the Secretary's choice of formula if the method he selected is reasonable. Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. at 843; Peoples Fed. Sav. & Loan Association v. Commissioner, 948 F.2d at 299-300; see also National Muffler Dealers Association v. United States, 440 U.S. at 488; United States v. Correll, 389 U.S. at 306-307. Petitioners further argue essentially that the Amended Formula cannot be valid because the formula does not equal the hospitals' actual bad debt writeoff experience. We do not believe that section 448(d)(5) requires an exact matching of the Uncollectible Amount with a taxpayer's actual bad debt writeoff experience. A statistical approximation of the Uncollectible Amount determined under the prescribed formula appears to be all that was contemplated by Congress. See H. Rept. 99-426, supra at 608, 1986-3 C.B. (Vol. 2) at 608, H. Conf. Rept. 99-841 (Vol. 2), at II-288 (1986), 1986-3 C.B. (Vol. 4) 1, 288. As to the nonaccrual-experience method, the conference report states the following:Page: Previous 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Next
Last modified: May 25, 2011