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IRS.gov Website
Publication 510
taxmap/pubs/p510-045.htm#en_us_publink1000306497

Chapter 11
Patient-Centered Outcomes Research Fee(p38)


The patient-centered outcomes research fee is imposed on issuers of specified health insurance policies (section 4375) and plan sponsors of applicable self-insured health plans (section 4376) for policy and plan years ending on or after October 1, 2012. Generally, references to taxes on Form 720 include this fee.
taxmap/pubs/p510-045.htm#en_us_publink1000307484

Specified health insurance policies. (p39)

rule
For issuers of specified health insurance policies, the fee for a policy year ending on or after October 1, 2013, and before October 1, 2014, is $2.00, multiplied by the average number of lives covered under the policy for that policy year. The fee for a policy year ending on or after October 1, 2014, and before October 1, 2015, is $2.08, multiplied by the average number of lives covered under the policy. Generally, issuers of specified health insurance polices must use one of the following four alternative methods to determine the average number of lives covered under a policy for the policy year.
  1. The actual count method.
  2. The snapshot method.
  3. The member months method.
  4. The state form method.
taxmap/pubs/p510-045.htm#en_us_publink1000307485

Applicable self-insured health plans.(p39)

rule
For plan sponsors of applicable self-insured health plans, the fee for a plan year ending on or after October 1, 2013, and ending before October 1, 2014, is $2.00, multiplied by the average number of lives covered under the plan for that plan year. The fee for a plan year ending on or after October 1, 2014, and before October 1, 2015, is $2.08, multiplied by the average number of lives covered under the plan for that plan year. Generally, plan sponsors of applicable self-insured health plans must use one of the following three alternative methods to determine the average number of lives covered under a plan for the plan year.
  1. Actual count method.
  2. Snapshot method.
  3. Form 5500 method.
taxmap/pubs/p510-045.htm#en_us_publink1000307486

Reporting and paying the fee.(p39)

rule
File Form 720 annually to report and pay the fee on the second quarter Form 720 no later than July 31 of the calendar year immediately following the last day of the policy year or plan year to which the fee applies. If you file Form 720 only to report the fee, do not file Form 720 for the first, third, or fourth quarters of the year. If you file Form 720 to report quarterly excise tax liability for the first, third, or fourth quarter of the year (for example, filers reporting the foreign insurance tax (IRS No. 30)), do not make an entry on the line for IRS No. 133 on those filings.
Deposits are not required for this fee, so issuers and plan sponsors are not required to pay the fee using Electronic Federal Tax Payment System (EFTPS).
However, if the fee is paid using EFTPS, the payment should be applied to the second quarter. See Electronic deposit requirement under How To Make Deposits in chapter 13, later.
taxmap/pubs/p510-045.htm#en_us_publink1000307487

More information.(p39)

rule
For more information, including methods for calculating the average number of lives covered, see sections 4375, 4376, 4377 and Regulations 46.4375-1; also see T.D. 9602, which is on page 746 of I.R.B. 2012-52 at www.irs.gov/pub/irs-irbs/irb12-52.pdf as updated by Notice 2014-56 on page 674 of I.R.B. 2014-41 at www.irs.gov/pub/irs-irbs/irb14-41.pdf.