"Are you suggesting deducting the purchased A/R as Other Costs on Form 1125-A?"

That was my suggestion.

To everyone else- TaxGirl's client bought the receivables, presumably when they bought all of the assets of a practice. When patients, ins. cos, whomever, paid their outstanding bills TaxGirl's client received the payments. 

I don't think AR is a 197 intangible.