PCORI Snapshot Method Explained
Under the PCORI snapshot method, you don't track every day. You count covered lives on one date per quarter of the plan year (or more, if each quarter has the same number), add those counts, and divide by the number of dates. Getting the dates right is the part that catches people, and after that you choose how to count on each date.
Which dates can you use?
The regulation sets these limits for each plan year:
| Rule | What it means | Illustration |
|---|---|---|
| First-quarter date | Any date in the first, second, or third month of the quarter | October 15 for an October 1 plan year |
| Later quarters | Each date must be within three days of the corresponding date | April 15 corresponds, so April 12 to 18 works |
| Same plan year | All dates must fall within the same plan year | A count after the plan year ends can't be used |
| Month-end dates | The 30th and 31st are treated as the last day of a shorter month | March 30 or 31 corresponds to June 30 |
| More than one date | Allowed if the number of dates is equal across quarters | Three per quarter means 12 dates |
Pick your date early in the plan year. If you decide after the first quarter has passed, you need records that show enrollment on an earlier date.
What are the two ways to count on each date?
Snapshot count
You use the actual number of lives covered on the date, which includes dependents. It requires reliable dependent data, and in return it reflects the people actually enrolled.
Snapshot factor
You count participants instead of people. The number of lives on the date equals participants with self-only coverage, plus participants with other than self-only coverage multiplied by 2.35. This helps when your system shows coverage tiers but not dependents. It uses a fixed multiplier, though, so it won't reflect how large your families really are.
The same plan worked out both ways
This plan is made up. It is self-insured, with a plan year from October 1, 2025 to September 30, 2026. The sponsor uses a date in the first month of each plan-year quarter. In April, it moved the count to the 17th, which is within three days of the 15th.
Using snapshot count
| Date | Actual lives covered |
|---|---|
| Oct 15, 2025 | 412 |
| Jan 15, 2026 | 418 |
| Apr 17, 2026 | 430 |
| Jul 15, 2026 | 428 |
| Total | 1,688 |
The average is 1,688 divided by 4, or 422 lives. The plan year ends before October 1, 2026, so the rate is $3.84. The fee is 422 x $3.84 = $1,620.48.
Using snapshot factor
| Date | Self-only | Other coverage | Other x 2.35 | Lives |
|---|---|---|---|---|
| Oct 15, 2025 | 126 | 120 | 282 | 408 |
| Jan 15, 2026 | 130 | 120 | 282 | 412 |
| Apr 17, 2026 | 104 | 140 | 329 | 433 |
| Jul 15, 2026 | 102 | 140 | 329 | 431 |
| Total | 1,684 |
The average is 1,684 divided by 4, or 421 lives. The fee is 421 x $3.84 = $1,616.64. For this made-up plan, the two come out close. In a plan where families are larger or smaller than the factor assumes, the gap would be wider, and it can go in either direction. To test your own average, use the PCORI fee calculator.
The regulation doesn't state a rounding rule in the text we reviewed, so these examples use counts that average to whole numbers. If yours doesn't, ask a tax professional how to report it.
Should you use more than one date per quarter?
You can, and it may suit a plan whose enrollment moves around within a quarter. The rule is equal numbers: two dates in the first quarter means two dates in each of the other three, for eight in total. Each later date must correspond to one of the first-quarter dates, or fall within three days of it.
For example, a plan year starting October 1 could count on October 15 and November 15, then on the matching dates in January and February, April and May, and July and August. You then add all eight counts and divide by 8, not by 4. A made-up total of 3,376 lives across eight dates gives an average of 422.
More dates mean more rosters to pull and save. If your administrator already sends monthly enrollment on a fixed day, that is 12 dates with three per quarter, and the extra counts cost you little.
What can go wrong?
- Leaving out people who count. IRS Q&A 6 says COBRA participants, retirees, and their beneficiaries are included. Make sure the roster you pull has them.
- Using calendar quarters on a fiscal plan. For a plan sponsor, the regulation says each quarter of the plan year.
- Changing method mid-year. A sponsor must use the same method for the whole plan year. The regulation's own example moves to the snapshot factor from one plan year to the next, which is allowed.
- Counting an HRA family. A sponsor whose only self-insured plan is an HRA or health FSA may treat each participant as one life. Our HRA and FSA post covers those arrangements.
If you are still choosing a method, our guide to average covered lives shows the others.
How do you file a snapshot result?
Your final average goes in column (a) of the matching line 133 row on the second-quarter Form 720. For the plan above, the return is due Monday, August 2, 2027, because July 31, 2027 is a Saturday. If your plan year ends after September 30, 2026, the IRS publishes that rate, so check the second-quarter 2027 instructions.
To file your PCORI fee online with EasyFile720, you enter your figures in a guided filing, from business details to submission. You do the snapshot counts yourself. The rates are built in, the math is calculated for you, validations catch common mistakes, and you sign electronically. You get an electronic acknowledgment from the IRS once the return is accepted, and the return stays saved in your account, which is useful for next year's comparison.
Your next step: save your four dated counts with the roster behind each one, then create a free account with no credit card and start from the PCORI fee filing page. You pay $39.95 when you file.
FAQ
Can I take more than one snapshot per quarter?▼
Yes. You may use more dates in each quarter if you use the same number of dates in every quarter. You then divide the total by the number of dates counted.
Does a snapshot have to be on the first day of a quarter?▼
No. The date can be in the first, second, or third month of the quarter. The later quarters then need dates that match it, within three days.
Can an insurance company use the 2.35 factor?▼
The snapshot factor is written into the plan sponsor regulation, section 46.4376-1. The insurer regulation, section 46.4375-1, describes the snapshot method without that factor.
Do I need to use calendar quarters?▼
For a self-insured plan, the regulation refers to each quarter of the plan year. So a plan year starting October 1 has quarters starting October, January, April, and July.
File your PCORI fee online
Create a free account with no credit card and build your return. You pay $39.95 only when you file. EasyFile720 is an IRS-authorized e-file provider, and you get an acknowledgment when the IRS accepts your return.
Sources: 26 CFR 46.4376-1, 46.4375-1; IRS PCORI Questions and Answers (Q3, Q5, Q6); Instructions for Form 720 and Form 720 (Rev. June 2026). General information, not tax advice. Confirm how the rules apply to you with a qualified advisor or the IRS.
