Alert: New Fee Related to Affordable Care Act
Please be advised of a new and upcoming fee to be reported and paid to the IRS.
The Affordable Care Act includes a provision that requires a fee to be paid by issuers of specified health insurance policies and plan sponsors of applicable self-insured health plans. The purpose of this fee is to help fund the Patient-Centered Outcomes Research Institute (PCOR). This fee is temporary and is slated to end on September 30, 2019.
Who pays the fee:
- Businesses that sponsor self-insured health plans
- Businesses that provide a Health Reimbursement Account (HRA), and/or
- Businesses that provide certain Health Flexible Spending Arrangements (Health FSA)
When to pay the fee:
- If your plan year ends on or after October 1, 2012, the first payment is due July 31, 2013
- If your plan year ends on or after October 1, 2013, the first payment is due July 31, 2014
How much: the amount of the fee for plan years ending on or after October 1, 2012 and before October 1, 2013 is $1.00 multiplied by the average number of lives covered under the plan. For plan years ending on or after October 1, 2013 the fee is raised to $2.00 multiplied by the average number of lives covered under the plan
How to pay: the fees are to be reported annually on Part II of the second quarter Form 720, which is due July 31 of each year
Where to find additional information: We are available to assist you with any questions you may have on this matter.
Please contact your Whalen business advisor to let us know how we can help!