Form 720 is the IRS Quarterly Federal Excise Tax Return, filed by businesses that owe or collect federal excise taxes, such as fuel, indoor tanning, foreign insurance and the PCORI fee on self-insured health plans. It's due by April 30, July 31, October 31 and January 31, and for 2026 it also covers a new 1% excise tax on certain cash-funded remittance transfers.
Most small businesses never file Form 720. But a few everyday situations pull you in, and two of them catch employers and service businesses by surprise. Here's who files, when, and the 2026 changes in the latest IRS instructions.
Who has to file Form 720
The instructions say you must file if you're liable for, or responsible for collecting, any of the federal excise taxes in Parts I and II for the current quarter, or if you were liable for a prior quarter and haven't filed a final return. The list is long, covering fuels, air transportation, communications, tires, vaccines, sport fishing equipment and more, but these are the entries most likely to affect a small business:
| Situation | Form 720 line | Key rule (IRS, as of October 2026) |
|---|---|---|
| You run a self-insured health plan for staff | PCOR fee, IRS No. 133 | $3.84 per average covered life for plan years ending October 1, 2025 to September 30, 2026 |
| You run a tanning salon | Indoor tanning, IRS No. 140 | 10% of the amount paid, collected from the customer |
| You send remittances for customers | Remittance transfers, IRS No. 155 | 1% on certain transfers funded with cash or similar physical instruments |
| You insure with a foreign insurer | Foreign insurance, IRS No. 30 | Tax on premiums paid to foreign insurers |
The PCORI fee employers forget
If your business runs a self-insured health plan for its staff, you may owe the patient-centered outcomes research (PCOR) fee. The instructions say the fee for plan years ending on or after October 1, 2025, and before October 1, 2026, is $3.84 multiplied by the average number of lives covered, up from $3.47 the year before.
It's an annual fee reported on the second-quarter Form 720, due by July 31 of the year after the plan year ends. No deposits are required, and if the PCOR fee is the only thing you report, you don't file Form 720 for the other three quarters. To count the average number of lives covered, the instructions give self-insured plans three methods to choose from: the actual count method, the snapshot method or the Form 5500 method. Because the rate changes every year, the IRS tells you to use the second-quarter instructions to work it out. If you run benefits through a provider or benefits administration software, ask who files it, because the IRS imposes the fee on the employer that runs the plan.
New for 2026: the remittance transfer tax
The One Big Beautiful Bill Act created section 4475, which imposes a 1% excise tax on certain remittance transfers that occur after 2025. It applies when the sender pays with cash, a cashier's check or a similar physical instrument. Remittance transfer providers must collect the tax from senders, make semimonthly deposits and file Form 720 each quarter; the first semimonthly deposit was due January 29, 2026, and the IRS has given limited penalty relief on deposits for the first three quarters of 2026.
Due dates
| Quarter | Months | Form 720 due |
|---|---|---|
| First | January, February, March | April 30 |
| Second | April, May, June | July 31 |
| Third | July, August, September | October 31 |
| Fourth | October, November, December | January 31 |
If a due date falls on a Saturday, Sunday or legal holiday, you can file on the next business day.
Deposits: the $2,500 rule
Most excise taxes are deposited semimonthly, not just paid with the return. The instructions say no deposit is required if your net liability for Part I taxes doesn't exceed $2,500 for the quarter; you pay with the return instead. You still complete Schedule A to record net liability for each semimonthly period, even if it's under $2,500, and deposits must be made electronically.
How to file Form 720
- Check every line that applies to your business in Parts I and II.
- Work out the liability for each, using the rates in that quarter's instructions.
- Complete Schedule A if you report Part I taxes.
- Make semimonthly deposits if your Part I liability is over $2,500 for the quarter.
- E-file through an approved provider, or mail the return, by the due date.
- Use Form 720-X to correct a return you've already filed.
If excise taxes sit alongside sales tax in your business, sales tax software and bookkeeping software help keep the liabilities separate.
My verdict
If you don't sell fuel, tanning, flights or remittances, Form 720 may never touch you, with one big exception: employers with self-insured health plans. That annual PCORI fee is easy to miss because it's due on a quarterly excise return most employers have never heard of. Check your plan type before July 31, and put the date in the calendar next to your other payroll deadlines.
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Frequently asked questions
What is Form 720?
The IRS Quarterly Federal Excise Tax Return, used to report and pay federal excise taxes and the PCOR fee.
When is Form 720 due?
April 30, July 31, October 31 and January 31, for the quarters ending March, June, September and December.
How do I count covered lives for the PCORI fee?
Self-insured plans use one of three methods set out in the instructions: the actual count method, the snapshot method or the Form 5500 method.
Do employers have to file Form 720?
Employers that run self-insured health plans file it once a year on the second-quarter return to pay the PCOR fee, due by July 31.
How much is the PCORI fee for 2026?
$3.84 multiplied by the average number of lives covered, for plan years ending on or after October 1, 2025, and before October 1, 2026.
What is the new remittance transfer tax?
A 1% excise tax on certain remittance transfers after 2025 where the sender pays with cash, a cashier's check or a similar physical instrument. Providers collect it and report it on Form 720.
Are deposits required for Form 720 taxes?
Usually, semimonthly. No deposit is required if your net Part I liability is $2,500 or less for the quarter.
