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Department of the Treasury

IRS guidance aids victims of domestic violence

Posted on March 26, 2014

Guidance issued by the Internal Revenue Service (IRS) permits married individuals separated from their spouses due to domestic violence to receive income-based premium tax credits. Typically, spouses are expected to file taxes jointly in order to be eligible for premium subsidies under the Affordable Care Act (ACA). Today’s guidance allows for an exception to this rule and also extends the enrollment deadline for this population by two months, through May 31st.

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IRS issues new ACA-related rules

Posted on March 6, 2014

A final rule released by the Internal Revenue Service (IRS) addresses the reporting requirements for large employers under the Affordable Care Act (ACA). Beginning in 2015, employers with more than 50 full-time employees are required to offer quality and affordable insurance to their employees. The new rule provides a methodology designed to simplify and reduce the costs associated with the employer reporting requirements mandated under the ACA. Another final rule issued by the IRS describes how issuers of minimum essential coverage are expected to report information to the IRS on the type and duration of coverage.

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Tri-agency rules address 90-day waiting period limit

Posted on February 20, 2014

The US Department of Health and Human Services (HHS), the Internal Revenue Service (IRS) and the Employee Benefits Security Administration (EBSA) released several rules today concerning the 90-day waiting period limitation before insurance coverage can become effective. The final rule states that group health insurance plans cannot apply a waiting period that exceeds 90 days beginning January 2015. The proposed rule clarifies the 90-day limitation in terms of the length of employment-based orientation periods, stating that one month is the reasonable limit for employment-based orientation periods.

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IRS rule addresses employer mandate, calculating teacher hours

Posted on February 11, 2014

A new rule issued by the Internal Revenue Service (IRS) addresses several components of the employer shared responsibility provisions within the Affordable Care Act (ACA). The rule further delays the employer shared responsibility payment for medium-sized businesses (50-100 employees) until 2016. Large employers will be able to phase in the percentage of full-time employees to whom they must provide health insurance, starting with 70% in 2015 and moving to 95% by 2016. IRS also released a fact sheet to accompany this rule. Additionally, this rule stated that teachers cannot be considered part-time employees because many do not work a full summer schedule.

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When Does Medicaid Coverage Amount to Minimum Essential Coverage Under the Affordable Care Act? An Update on the Treasury/IRS Rules Defining Minimum Essential Coverage

Posted on February 11, 2014

A January 27, 2014 proposed rule in the Federal Register (79 Fed. Reg. 4302-4308) published by Treasury/IRS would add further clarification to the question of under what circumstances the agencies will classify Medicaid as minimum essential coverage (MEC) for purposes of satisfying the Affordable Care Act’s requirement to maintain MEC or pay a shared responsibility tax. Comments are due by April 28, 2014; the agencies also intend to hold a public hearing on the NPRM which covers Medicaid as well as other types of coverage.

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IRS documents address minimum essential coverage

Posted on January 24, 2014

The Internal Revenue Service (IRS) released several documents concerning the maintenance of minimum essential coverage. The first document is a proposed rule issued concerning certain types of Medicaid coverage that do not satisfy the minimum essential coverage requirement under the Affordable Care Act (ACA). The proposed rule states that individuals with this coverage will not owe a shared responsibility payment. The proposed rule also outlines hardship exemptions and enrollment in employer-sponsored health insurance plans. In addition to the rule, the IRS released a notice stating that individuals with limited Medicaid coverage or limited coverage from military health benefits will not be subject to the individual shared responsibility payment.

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Update: Proposed IRS Procedures for Tax-Exempt Hospitals to Correct and Disclose Failures to Meet Their Community Benefit Obligations Under the Internal Revenue Code

Posted on January 13, 2014

In order to be exempt from federal income taxes, nonprofit hospitals seeking such a designation under the Internal Revenue Code must provide a community benefit, a policy that has been in place since 1969 but that has gone essentially unenforced since its creation by the Nixon Administration. Government estimates of the value of nonprofit hospital tax-exemption placed the total national value at more than $12 billion in 2002, a figure that undoubtedly has grown over the past decade and that reflects both federal tax losses and losses resulting from the fact that most states and localities use federal law to determine exemption from state and local property, sales, and income taxes…

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IRS rule cuts nonprofit hospitals some slack

Posted on December 31, 2013

A new rule released by the Internal Revenue Service (IRS) states that nonprofit hospitals failing to satisfy many of the new standards under the Affordable Care Act (ACA) will not lose their tax-exempt status, as long as the shortcomings were not “willful” or “egregious.” Under the ACA, nonprofit hospitals are expected to perform Community Health Needs Assessments, and then work towards implementing these findings in their communities. This proposed rule permits a nonprofit hospital failing to meet these and other standards to discuss the situation with the IRS and therefore not immediately lose tax-exempt status.

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IRS rule prohibits grant-funded work to count as community benefit

Posted on December 30, 2013

A draft rule released by the Internal Revenue Service (IRS) states that not-for-profit hospitals are no longer permitted to count local community benefit services funded by grant revenue when reporting these activities for tax exemptions. In order for non-federal hospitals to receive tax exemptions, these hospitals are required to perform and document their community benefit efforts, such as health-education or free healthcare services, on their Schedule H form. Proponents of the rule state that this change will increase transparency in how community benefit activities are funded, as well as level the playing field for teaching and non-teaching hospitals, who sometimes receive disparate amounts of grant funding.

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IRS provides ACA tax relief for some small employers

Posted on December 19, 2013

In guidance released by the Internal Revenue Service (IRS), the agency is providing some small businesses a one-year reprieve in meeting the criteria to qualify for small business tax credits in qualified health plans (QHPs) sold on the Small Business Health Options Program (SHOP). In many counties in Wisconsin and Washington state, however, QHPs will not be available on SHOP Marketplaces, meaning many small businesses would be ineligible to receive the tax credit that would help employers pay for premiums for their employees. According to IRS, this guidance permits small businesses in these areas to qualify for the 2014 tax credits based upon the 2013 rules.

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