IRS has issued Notice 2010-39 in which it seeks comments from the exempt hospital community on the requirements of new section 501(r), enacted as part of this year’s healthcare legislation. The new statute specifically requires exempt hospital organizations to:
- conduct community health needs assessment every 3 years,
- establish financial assistance policy,
- limit amounts charged for emergency or other medically necessary care, and
- agree to forego extraordinary collection actions before determining whether individual is eligible for assistance under organization’s financial assistance policy.
IRS is specifically requesting comments regarding the need, if any, for guidance relating to the new requirements, what constitutes “reasonable efforts” to determine eligibility for assistance under a financial assistance policy for purposes of the billing and collection requirements, and the provisions of section 501(r)(2)(B)(ii), which provides that an organization that operates more than one hospital facility “shall not be treated as described in [section 501(c)(3)] with respect to any such facility for which such requirements are not separately met,” including the tax consequences of a failure with respect to some, but not all, facilities and the proper tax treatment in future periods in such a case.
Click here to see notice for additional information and let us know if there’s anything you want to discuss. Comments must be submitted by 7/22/2010.
For more information please contact Leigh McKee at lmckee@ddfky.com
Beginning with 2009 Form 5500 filings, employee benefit plans under section 403(b) of the IRC will be subject to the same reporting and audit requirements that currently exist for 401(k) plans. Is your organization ready?
The major new requirement is the presence of a Plan Document. The Plan Document will have the same required elements as a 401(k) plan (eligibility, investment options, contribution limitations, vesting schedules, distribution guidelines, provisions for compliance testing, etc). Your plan record keeper should have the ability to help draw up a plan that meets IRS guidelines.
Another large provision relates to the audit requirement – if your organization has over 100 eligible participants, your 403(b) plan will have to be audited for any plan years beginning on or after January 1, 2009. Audits can be quite time-consuming on any organization, especially in the first year. Beginning balances will have to be audited in addition to 2009 amounts. It may be difficult to gather complete and accurate investment information from all third party administrators (TPAs) that have been associated with the plan. Records may not be readily available and may come from multiple sources. It may also be difficult to collect information related to former employees who continue to have holdings in the plan. You should begin discussing your needs with all applicable TPAs as soon as possible so that it will be clear what they will be able to provide. As the information is being gathered, the plan sponsor (usually your organization) will need to carefully and thoroughly document its approach for the data collection.
There are several other new requirements that may also impact your plan. If you have any questions related to what information you’ll need to be prepared for these requirements, feel free to give us a call.
Morgan Daulton
mdaulton@ddfky.com
On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009 (the Recovery Act) into law. This act provided for a $787 billion economic stimulus package, of which, $135 billion is designated for construction, repair and maintenance of federal buildings, public transportation infrastructure and other public works. Section 1605 of the Recovery Act, titled “Use of American Iron, Steel, and Manufactured Goods” contains requirements that any project receiving stimulus funds for “the construction, alteration, maintenance, or repair of public buildings or public works” utilize “iron, steel, and manufactured goods…. produced in the United States.” This “Buy American” requirement has become a focal point within the construction industry, as contractors seek to maximize opportunities provided by the Recovery Act.
The Recovery Act does contain some exceptions to the requirements of section 1605. The “Buy American” requirements may be waived if it can be determined that buying American materials “would be inconsistent with the public interest.” An exception would also be granted if the availability of materials produced in the United States were insufficient. A third exception is if the use of American made components would increase the costs of the overall project by more than 25%.
The implementation of Section 1605 of the Recovery Act has generated some controversy within the construction industry as experts try to dissect various terms within the Act’ wording. The Recovery Act does not provide clear guidance for what constitutes a “maintenance” project. Previous public building projects have focused on terms such as “construction” and “repair”, but not “maintenance”. Industry experts have also speculated about the absence of a clear definition for the terms “public building” and “public works.” The phrase “produced in the United States” is also open to debate as the Recovery Act has not adopted definitions as historically presented within subpart 25.2 of the Federal Acquisition Regulation, which has governed previous public construction projects.
The provisions of Section 1605 of the American Recovery and Reinvestment Act of 2009 are facts of life now. These provisions will impact every step of the construction process. The controversy and uncertainty surrounding the implementation of the requirements within Section 1605 will continue to be a focus of attention until further clarification is provided.
Many businesses working on construction projects receiving stimulus funding will fall under the “Buy American” requirements of Section 1605. Dean Dorton Ford, PSC has over thirty years of experience in helping clients navigate through new legislation impacting their businesses. Our construction team devotes significant time to researching changes within the construction industry and seeking new opportunities to better serve our clients. We would be happy to offer your business our expertise.
If you have any questions please contact Justin Hubbard at jhubbard@ddfky.com
