In Annoucement 2011-37, released on June 9, 2011, the IRS advised tax exempt hospitals that completion of Part V, Section B, of Schedule H of the 2010 Form 990 would be optional for the 2010 tax year.

Background

Section 9007 of the Patient Protection and Affordable Care Act, enacted on March 23, 2010, added new section 501(r) to the Internal Revenue Code (“Code”). Section 501(r) sets forth additional requirements for tax-exempt hospitals to qualify for exemption under section 501(c)(3) of the Code. The requirements include: (1) adoption and implementation of a written financial assistance policy; (2) adoption and implementation of a nondiscriminatory policy for providing emergency care; (3) limiting the amounts charged for emergency care and other medically necessary for individuals eligible for financial assistance; and (4) for tax years beginning after March 23, 2012, a requirement that hospitals conduct community health needs assessments.

Relief Granted

In Announcement 2011 37, the IRS advised that completion of Part V, Section B, of Schedule H is optional for the 2010 tax year. The stated reason is that the IRS determined it was appropriate to give hospitals more time to become familiar with the types of information the IRS would be requiring and to address any ambiguities arising from the extension revisions of Schedule H and its instructions. Part V.B. of Schedule H includes questions regarding community health needs assessments, financial assistance policies, billing and collections and charges for medical care. The Announcement further provides that no penalties will be assessed for failure to complete any parts of Part V.B. of Schedule H.

Delayed Filing Date for Hospital Forms 990 Remains in Effect

In Announcement 2011-20, March 3, 2011, the IRS directed hospitals not to file the 2010 Form 990 before July 1, 2011. It granted hospitals with return due dates prior to August 15, 2011, an automatic three-month extension to file. This directive remains in effect.