Healthcare Perspectives


IRS extends community health needs assessment requirements deadline

Jul 21, 2020
By: Terri Rexrode

In Notice 2020-56, the IRS provided a further postponement until December 31, 2020 for hospitals that are required to meet the community health needs assessment (CHNA) requirements that are due to be completed on or after April 1, 2020 and before December 31, 2020.


IRC Section 501(r)(3) requires a hospital to conduct a CHNA at least once every three years and adopt an implementation strategy to meet the identified community health needs.  The CHNA must take into account input from persons who represent the broad interests of the community served by the hospital, including those with special knowledge of or expertise in public health.  In addition, the CHNA must be made widely available to the public.

The CHNA must be conducted by the end of the third taxable year (or in either of the two taxable years immediately preceding such taxable year).  The implementation strategy must be adopted on or before the 15th day of the fifth month after the end of the taxable year in which the hospital facility completes the final step for the CHNA.  There is a $50,000 excise tax imposed on a hospital that fails to meet either or both section 501(r)(3) CHNA requirements with respect to any taxable year.

Previously, Notice 2020-23 postponed until July 15, 2020, the deadline for any CHNA due to be conducted and for any implementation strategy due to be adopted on or after April 1, 2020 and before July 15th, 2020.  Notice 2020-45 extends this relief to any hospital that is required to meet either of the CHNA requirements on or after April 1, 2020 and before December 31, 2020 to December 31,2020 due to the ongoing COVID-19 pandemic.

For example, if a hospital was required to conduct a CHNA by April 30, 2020 (the end of the third taxable year) and was required to adopt an implementation strategy by September 15, 2020 (4.5 months after year end), they are given an extension until December 31, 2020 to complete both steps.

This extension will give hospitals welcome relief in completing their CHNA requirements while being adversely affected by the COVID-19 emergency.


Terri Rexrode, CPA
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