Tax News & Views: Health Care Edition

Electronic Filing Reminder

Most tax-exempt organization returns are required to be electronically filed. The Taxpayer First Act, enacted on July 1, 2019, requires tax-exempt organizations to electronically file certain tax returns for tax years beginning after July 1, 2019. While there were certain transitional instances of relief in 2021 for tax-year 2020 returns, Forms 990, 990-PF, and 990-T are required to be electronically filed for tax-year 2021. For small tax-exempt organizations that file Form 990-EZ, there is some transitional relief whereby the IRS will accept either paper or electronic filing of Form 990-EZ for tax years ending before July 31, 2021. For Form 4720, Return of Certain Excise Taxes, electronic filing is required for private foundations for tax years ending December 2020 and after with a due date on or after July 15, 2021. However, taxpayers other than private foundations have the option to paper file still at this time but should refer to the instructions for Form 4720 and continue to monitor for any changes in the Form 4720 filing requirements. Organizations should continue to evaluate software providers in order to comply with the electronic filing requirements. In addition to the federal electronic filing requirements, organizations should consider any state unrelated business income return electronic filing requirements.

Internal Revenue Service Releases its 2022 “Dirty Dozen” Scam List

Each year the IRS compiles a list of a variety of common scams and potentially abusive arrangements that taxpayers may encounter or engage in referred to as the IRS Dirty Dozen. The IRS emphasizes that taxpayers should watch out for and avoid the schemes or abusive transactions identified and provides an explanation of each.

1. Use of Charitable Remainder Annuity Trust (CRAT) to eliminate taxable gain.
2. Maltese (or other foreign) pension arrangements misusing treaty.
3. Puerto Rican and other foreign captive insurance.
4. Monetized installment sales.
5. Pandemic related scams, including economic impact payment and tax refund scams, unemployment fraud leading to inaccurate taxpayer 1099-Gs, fake employment offers posted on social media, and fake charities that steal your money.
6. Persons claiming they can settle tax debt for pennies on the dollar, known as Offer In Compromise (OIC) mills. Taxpayers should avoid unscrupulous tax preparers including “ghost” preparers and aggressive promises of manufacturing a bigger refund.
7. Suspicious communications from scammers attempting to steal identities, personal financial information and more – includes text message scams, email phishing scams, and phone scams.
8. Spear phising.
9. Abusive syndicated conservation easements.
10. Abusive micro-captive insurance arrangements.
11. Concealing assets in offshore accounts and improper reporting of digital assets.
12. High-income individuals who don’t file tax returns.
    

Did you know?

IRS Updates Optional Standard Mileage Rates
IRS Announcement 2022-13 modifies previous IRS Notice 2022-03 to revise the optional standard mileage rates for computing the deductible costs of operating an automobile for business, medical, or moving expense purposes and for determining the reimbursed amount of these expenses that is deemed substantiated. The modification stems from the recent increases in fuel prices and is effective beginning July 2022. However, the mileage rate that applies to the deduction for charitable contributions is fixed under Internal Revenue Code section 170(i) and remains unchanged under this Announcement.

Additional Resources

Deloitte Center for Health Solutions
The source for health care insights: The Deloitte Center for Health Solutions (DCHS) is the research division of Deloitte’s Life Sciences and Health Care practice. The goal of DCHS is to inform stakeholders across the health care system about emerging trends, challenges, and opportunities.

Health Forward blog
Connect to the forces of change across life sciences and health care today. Explore our latest leadership insights to stay ahead of industry trends and key issues on health care, medtech, and biopharma.

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