The IRS has now issued guidance, in question and answer form, on the new Patient-Centered Outcomes Research Trust Fund (“PCORI”) Fee. The guidance confirms that the fee applies even to health plans for tax-exempt organizations or governmental entities.
Highlights of the guidance:
- The fee is to be paid by the insurance company if the plan is insured, or by the plan sponsor if it is not.
- The fee will be $1 per plan participant for the first plan year ending after Sept. 30, 2012, and $2 per participant in succeeding years. For policy or plan years ending on or after Oct. 1, 2014, the fee will be increased based on increases in the projected per capita amount of national health expenditures.
- Plan sponsors subject to the tax will file annually Form 720, Quarterly Federal Excise Tax Return, to report and pay the PCORI fee. The Form 720 will be due on July 31 of the year following the last day of the policy year or plan year.
- Electronic filing is available but not required. If the payment is made through the Electronic Federal Tax Payment System (EFTPS), it should be applied to the second quarter (in EFTPS, select Q2 for the Quarter under Tax Period on the “Business Tax Payment” page).
- Payment will be due at the time the Form 720 is due. Deposits are not required for the PCORI fee.