IRS Finalizes Broad Tax Exemption Requirements for Health Care CO-OPs

The Tax Management Transfer Pricing Report ™ provides news and analysis on U.S. and international governments’ tax policies regarding intercompany transfer pricing.

Jan. 26 — The IRS issued final rules describing procedures by which health insurance issuers may apply for exemption from paying income taxes.

The rules (T.D. 9709, RIN 1545-BK64), released Jan. 26, said qualified nonprofit health insurers must apply for tax-exempt recognition with the Internal Revenue Service, and that the IRS and Treasury Department will recognize them as exempt organizations effective on the later of either their date of formation or March 23, 2010, the date the Affordable Care Act became law.

The rules were proposed in February 2012, and the IRS said it adopted those proposed rules (REG-135071-11) as final regulations without revision.

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