How Long Should PCORI Records Be Retained?
How Long Should You Keep PCORI Fee Records?
The short answer: at least 4 years. The IRS Form 720 instructions state that you should keep records to support all claims and exemptions for at least 4 years from the latest of the date the tax became due, the date you paid the tax, or the date you filed a claim. That 4-year window applies directly to PCORI fee documentation, since the fee is reported on Form 720 under IRS No. 133.
IRS Record Retention Expectations for Form 720 Filings
The Form 720 instructions are clear that recordkeeping isn't an afterthought. Filers are expected to keep copies of their tax return, records, and accounts of all transactions to show that the correct tax was paid. For PCORI specifically, that means retaining whatever supports the average covered life count and the rate applied for that plan year, since the fee is calculated by multiplying covered lives by the applicable rate.
If you want the full breakdown of what the IRS expects across all tax types, the IRS record keeping requirement page lays out the general standard employers should follow.
When Longer Retention May Be Necessary
What Documents Should Be Retained for PCORI Compliance?
PCORI record retention isn't just about saving the form you filed. The IRS expects documentation that shows how you arrived at the numbers on that form.
1)Covered Life Calculation Records
Whichever method you use - actual count, snapshot, or Form 5500, you need the underlying data and the math behind it. This is the piece most likely to get questioned in an audit, since the average covered life count drives the entire fee calculation.
2)Form 720 and Payment Documentation
Keep a signed copy of every Form 720 you filed for PCORI, along with proof that the payment cleared. Bank confirmations, EFTPS receipts, or canceled checks all count. Without this pairing of form and payment proof, you can't fully demonstrate compliance.
3)Health Plan Supporting Documents
Plan year start and end dates determine which rate applies, so plan documents that establish those dates belong in your file. For plan years ending between October 1, 2024 and September 30, 2025, the rate is $3.47 per covered life; for plan years ending between October 1, 2025 and September 30, 2026, it rises to $3.84. If you sponsor an HRA alongside a fully insured medical plan, keep the documentation that shows the HRA was filed and paid separately, since that's a distinct obligation from the insurer's responsibility on the medical side.
An IRS inquiry into your PCORI filing doesn't always come quickly. By the time it does, the person who calculated the fee may have moved on, and the spreadsheet may be buried somewhere nobody remembers. Solid record retention means you can answer questions with documentation instead of guesswork.
It also protects you on the budgeting side. If finance ever needs to reconstruct what was paid and why, having organized records means that's a quick lookup rather than a multi-week reconstruction project. For a refresher on what counts as an applicable plan and how the fee is structured, the PCORI Fees guide covers the basics.
Most PCORI compliance problems aren't about the filing itself. They're about what happens, or doesn't happen, after the form is submitted.
Read our blog on PCORI Filing Mistakes to avoid!
Relying Only on Payroll or Insurance Reports
Payroll and insurance reports weren't built with PCORI in mind, and they don't always capture covered lives the way the IRS expects. Treating them as your sole source of truth leaves gaps if the IRS asks how you actually arrived at your count.
Losing Proof of Payment After Filing
A filed form without proof of payment is an incomplete record. If the IRS can't see that the fee was actually remitted, you're left trying to track down bank records from years earlier.
Using Inconsistent Counting Methods Year to Year
Switching between actual count, snapshot, and Form 5500 methods without documenting why can raise questions during a review. Keeping a consistent method, and a record of any year you changed it, makes your filing history easier to defend. You can sanity-check your numbers each year using the PCORI Fee Calculator before you file.
How Simple720 Helps Simplify PCORI Documentation
Good intentions around recordkeeping only go so far without a system to back them up, which is where Simple720 comes in for organizations that want this handled properly.
Every record is stored in an organized manner and can be retrieved anytime in our seamless dashboard
You don't have to worry about security, since the portal is AICPA SOC 2 certified
Past filings, payment confirmations, and calculation records stay in one place instead of scattered across email threads and shared drives
Filing and payment proof are linked together automatically, so you're never stuck searching for one without the other
Bulk filers get the same organized recordkeeping across every entity, instead of managing separate folders for each filing
Conclusion
PCORI record retention comes down to one rule: keep your documentation for at least 4 years, longer if your broader policies require it. Good records turn a stressful audit request into a five-minute task, and they give your team the confidence to face a review head-on instead of dreading it.
Efile PCORI Fee 2026 Online with Simple720 now.
