IRS Initiates Compliance Check Of Tax-Exempt Hospitals

IRS Form 13790 Deadline Approaching

The IRS, similar to its 2005 initiative regarding executive compensation, is conducting a compliance check of the community benefits provided by approximately 600 tax-exempt hospitals nationally in an effort to increase voluntary compliance by tax-exempt organizations. The IRS has asked those hospitals to complete and return Form 13790, Compliance Check Questionnaire Tax-Exempt Hospitals. There are specific deadlines for submission of the responses to the IRS. Failure to timely respond will result in a case being forwarded for examination consideration.

Form 13790, a data-gathering device which is not an audit but can lead to one, is split into three parts. Part I identifies information about the organization. Part II (72 questions) inquires about various community benefit activities and governance, and Part III (9 questions) covers compensation practices. An organization's initial response to this Form will be critical as it will largely determine whether the organization is selected for additional scrutiny or a full examination.

Ice Miller is currently assisting clients in responding to Form 13790. If your organization has received a compliance check as part of the IRS' community benefit initiative and needs assistance in completing Form 13790, please contact Greg Pemberton, Kevin Woodhouse, or Marilee Springer.