IRS Issues Proposed Regs on Health Insurer Deduction Limitation

On April 1, the Internal Revenue Service (IRS) issued proposed regulations on the application of the $500,000 deduction limitation for remuneration provided by some health insurance providers under Internal Revenue Code section 162(m)(6).  Code section 162(m)(6)(C)(i) provides that a health insurance issuer is a covered health insurance provider for a tax year only if it receives premiums from providing health insurance coverage.  The proposed regulations provide rules for determining whether a health insurance issuer is a covered health insurance provider for any tax year and whether a person is treated as a single employer with a health insurance issuer that is a covered health insurance provider for any tax year.

Comments are due by July 1, 2013.