That time of the year when you have to do the PCORI fee filing? Wondering how to fill out form 720 for PCORI Fee? This comprehensive guide will take you through all the steps to manually file the PCORI fee.
Whether you are a small business owner or an Enterprise, you need to pay the PCORI fee when you file your taxes. Accurate filing of Form 720 is a must for all organizations.
Read on to know more on the PCORI fees and how to fill out the Form 720 for PCORI when you are filing your taxes manually.
Employees offering self-insured medical reimbursement health plans are required to pay the PCORI fees. Self-insured plans include Health Reimbursement Arrangement (HRA) plans. Here is a list of plans that are required to pay the PCORI fees by July 31st, every year.
Health and accident plans
HRAs with a plan year that began 1/1/2012 that are not an excepted benefit
Health Flexible Spending Arrangement (FSAs) with a plan year that began 1/1/2012 that are not excepted benefit
Retiree plans
Before we get into details on how to fill out Form 720 for PCORI fee, let us first understand what Form 720 is. Organizations use the Form 720 to report any Federal Excise tax collected. The tax categories include: Environmental taxes, Communication and transportation taxes, retail taxes, ship passenger taxes, PCORI fees, manufacturers taxes, and other excise taxes.
If your business owes the PCORI fee, then you are required to pay the fee with your second quarter return. The PCORI fees need to be paid by July 31st every year, missing this deadline attracts a PCORI penalty. You can file the PCORI fees either manually or through online portals. Let us understand the steps involved in filing the PCORI fees manually -
First step is to download the IRS Form 720 from the Official IRS website.
On the downloaded form, you need to enter all the business details.
You can skip Part 1 and move onto Part 2.
Move to the PCORI section and enter the relevant details in IRS No: 133 under part 2.
You need to clearly mention the number of lives covered. The fee is calculated by multiplying the number of lives with the applicable PCORI rate. The PCORI rate for 2025 is $3.47.
Read our blog on PCORI Fee Calculation to get detailed guidance for calculating your PCORI Fee.
Once the calculations are done, you need to sum up the total fee in Part 2.
Once this is done, you move on to Part 3, where you fill details in No. 10.
Now, fill the payment voucher Form 720-V, and send it to the official IRS mailing address.
Wrapping it up
We have explored how to fill out form 720 for PCORI Fee manually in this blog. However, this process can be complex and time consuming. The incidence of errors is high in manual filing. For hassle free and accurate filing of PCORI fees through the Form 720, choose our online portal Simple 720 for eFiling.