Hospitals need to prepare for new Form 990, Schedule H requirements
What constitutes community benefit and how do you quantify it? For the 2009 tax year (i.e. calendar year 2009 or fiscal years beginning in 2009), the revised Form 990, Schedule H, will require answers to those questions.
Washington lawmakers said they wanted a “clearer, more uniform definition of community benefit,” so the Internal Revenue Service (IRS) created Schedule H of the revised Form 990.
This presentation will walk you through the changes.
There will be many interested parties scrutinizing the way you respond, among them the IRS and legislators in Washington, D.C., and the public weary of continually increasing healthcare costs.
The Washington contingent wants to see a higher level of accountability and transparency. And the prediction is that there is more scrutiny to come as they consider setting a minimum level of charity care and community benefit expected from hospitals.
Your answers on community benefit will tell your story
Your constituents will also be very interested in this report and the story it tells about your commitment to the community you serve. The new Form 990, Schedule H, is a tax issue with possible public relations impact.
Plante Moran tax experts who understand non-profit hospitals are well prepared to help you quantify your benefit to the community. We will help you identify the information that needs to be gathered for Form 990 and then discuss the processes, procedures, and systems that need to be in place to consistently and accurately collect the required information. Because the 2009 tax year is the first year of full compliance with Form 990, Schedule H, this will be a time-consuming process.
Form 990, Schedule H, is just one of 16 schedules
Schedule H for hospitals is one of 16 supplemental schedules to the core Form 990. Hospitals will likely be required to complete many of the others. In addition to Form 990, Schedule H, it is recommended that hospitals pay particular attention to:
- Schedule C - political campaign and lobbying activities
- Schedule D - supplemental financial statements
- Schedule J - compensation information
- Schedule K - tax-exempt bonds
- Schedule L - transactions with interested persons
- Schedule R - related organizations and unrelated partnerships
Also Part VI of the core form reflects the increased interest by the IRS in governance issues and asks for detailed information regarding the hospital’s governance, management, and disclosure policies and practices.
The way you represent your hospital on Form 990 and its schedules should be considered more than a compliance issue. It will tell the hospital’s story of dedication to service and quality health care. We can help you ensure the Form 990 story you tell matches your dedication.