Can the PCORI Fee Be Paid From Plan Assets?
The general rule: employer's general assets
In guidance issued in January 2013, the Department of Labor addressed whether the PCORI fee can be paid from plan assets. The short answer for most employer health plans: it can't. Because the Affordable Care Act imposes the fee on the plan sponsor (typically the employer) rather than on the plan itself, the fee is the sponsor's liability and must come from the employer's general operating assets — not from participant contributions or a trust holding plan assets.
Why the fee can't come from plan assets
Under ERISA, plan assets must be used for the exclusive benefit of participants and to pay reasonable plan expenses. The PCORI fee is a liability of the sponsor as a separate entity, not a plan expense — so paying it out of plan assets would generally be an impermissible use of those assets. That's the core reason the DOL points employers to general assets.
The exceptions
- Multiemployer (union) plans. Here the plan sponsor is the independent joint board of trustees, so the board may generally pay the PCORI fee from plan assets — unless the plan document provides otherwise.
- Certain multiple-employer plans. A narrow exception can apply where the sponsor exists solely to sponsor and administer the plan and has no funding source independent of plan assets.
Practical takeaways
- If you're a typical single-employer self-insured (or level-funded) plan sponsor, budget the fee from your general account.
- Don't fund it from participant contributions or a plan trust.
- This doesn't change how you file — only the source of payment.
New to filing? Start with the PCORI fee filing guide, and if you sponsor a self-insured or level-funded plan, those pages cover who files and how.
FAQ
Can the PCORI fee be paid from plan assets?▼
Generally no. The Department of Labor has said the PCORI fee is imposed on the plan sponsor — usually the employer — so for an ERISA plan it must be paid from the employer’s general assets, not from plan assets or participant contributions. A limited exception applies to multiemployer (union) plans.
Why can’t the employer use participant contributions or the plan trust?▼
Because the fee is a liability of the plan sponsor as a separate entity, not a liability of the plan itself. Using plan assets (including participant contributions held in trust) to pay a sponsor obligation would generally be an impermissible use of ERISA plan assets.
Is there any exception?▼
Yes. For a multiemployer plan, the independent joint board of trustees is the plan sponsor and may generally pay the PCORI fee from plan assets unless the plan document says otherwise. A narrow exception can also apply to certain multiple-employer plans whose sponsor has no funding source independent of plan assets.
Does this change how I file the fee?▼
No. You still report the PCORI fee on the second-quarter Form 720 (IRS No. 133) by July 31. The plan-assets rule only affects which pocket the money comes from — for most employers, the general operating account.
File your PCORI fee the right way
EasyFile720 handles the calculation, the correct IRS line, and the e-file submission of IRS No. 133 — so you just pay the fee from the right account and you're done by July 31.
This article summarizes Department of Labor guidance (January 2013) on paying the PCORI fee from plan assets, alongside the PCORI regulations under IRC §§ 4375–4377. Plan-asset questions are fact-specific and governed by ERISA — confirm your situation with ERISA counsel or a qualified advisor. General information, not legal or tax advice.
