A recent report from the Treasury Inspector General for Tax Administration (TIGTA) said the IRS needs to make changes to its medical device excise tax program, which is part of the Affordable Care Act (ACA). The recommended improvements will serve to ensure accurate tax information reporting and payment of the tax.
The report included an assessment of how well the IRS processed tax information returns that reported the medical device excise tax and the agency’s efforts to identify noncompliant taxpayers. Importers, producers and manufacturers who must collect the tax are required to report on Form 720, Quarterly Federal Excise Tax Return. The TIGTA review discovered the number of filed forms and the associated revenues did not meet projections from the Joint Committee on Taxation.
“While the IRS has taken steps to educate medical device manufacturers of the medical device excise tax during implementation, it faces challenges to definitively identify manufacturers subject to the medical device excise tax reporting and payment requirements,” said J. Russell George, TIGTA.
According to Accounting Today, the IRS released a statement acknowledging that it reviewed TIGTA’s recommendations and has already made efforts to revise Form 720 and other parts of the medical devices excise tax program.
