Medical Device Excise Tax

The medical device excise tax applies to manufacturers and importers and generally does not apply to individual consumers. The medical device excise tax is reported on Form 720, Quarterly Federal Excise Tax Return. Payment is due with the return. The first quarterly return for the medical device excise tax is due April 30, 2013, for the months of January, February and March 2013. Form 720 may be filed electronically or on paper.

On Dec. 5, 2012, the IRS issued final regulations on the new 2.3 percent medical device excise tax that manufacturers and importers will pay on sales of certain medical devices beginning Jan. 1, 2013. In addition, the IRS issued Notice 2012-77, which provides interim guidance regarding the determination of sale price and other issues related to the tax.

Generally, under the final regulations, a “taxable medical device” is a device that is listed as a device with the FDA under section 510(j) of the Federal Food, Drug and Cosmetic Act, and 21 CFR part 807, pursuant to FDA requirements. If a device is not listed as a device with the FDA but the FDA determines that the device should have been listed as a device, the device will be deemed to be listed as a device with the FDA as of the date the FDA notifies the manufacturer or importer in writing that corrective action with respect to listing is required.

For more Questions check out he IRS FAQ section; http://www.irs.gov/uac/Medical-Device-Excise-Tax:-Frequently-Asked-Questions

For more information, call the toll-free Business and Specialty Tax Line (800-829-4933), available Monday – Friday from 7 a.m. to 10 p.m. local time, or visit the resources shown below.