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Isn’t my insurance carrier responsible for ACA filing?
If you are an Applicable Large Employer, your insurance carrier is only responsible for 1095B forms for dependents IF you are on a Fully Insured plan. You are ALWAYS responsible for filing 1095C forms for your employees AND, if you are on a Self-insured plan, you are also responsible for filing on behalf of their dependents.
Do I still need to file if I have less than 50 full time employees
Yes, your Applicable Large Employer status is based on full-time equivalent counts from the previous year. You will be relieved of a filing responsibility in the following calendar year if your entire tax year keeps you below the 50 FTE mark.
Do I need to include dependent information on our 1095 forms?
Who should be listed as the Point of Contact on my 1095 forms?
What do I do if I receive a 226J, 5699 or 972CG penalty letter from the IRS?
Call the number on the top of your letter if you receive a 226J or 5699 and ask for an extension, take down the name and badge number of the person you speak with, Then, contact ETC immediately. You do not need to be an ETC 1095 filing client to utilize the services of our preferred partner firm, Haff & Raggio PLLC. If you receive a 972CG, contact ETC immediately to discuss as there is no phone number you can request an extension. To date, partners Haff & Raggio have saved client’s over $1 million + in IRS penalties.
Has ACA gone away now that there is no longer an employee mandate?
Do I need a form for every single employee?
What is a Controlled Group?
What are the fines associated with ACA? Part 1
Part 1: The Employer Mandate (Employer Shared Responsibility Payment) provisions started in 2015 and penalties are indexed each calendar year. The Employer Mandate has 2 primary penalty components around offering coverage.
§4980H(a) – Applicable Large Employers must offer minimum essential coverage (MEC) to at least 95% of full-time eligible employees and their dependent children each month.
- 2022 Penalty: $2,750 Annual/$229.16 per month (up from $2,700 in 2021)
§4980H(b) – Applicable Large Employers must offer coverage that provides minimum value AND is affordable to all full-time eligible employees each month.
- 2022 Penalty: $4,120 Annual/$343.33 per month (up from $4060 in 2021)
If an employee eligible for the employer’s plan receives premium tax credits (PTC) from a government-run health exchange, it could trigger penalties for employers depending on certain circumstances.
Notices Used in the IRS enforcement process include: 226J and 227
What are the fines associated with ACA? Part 2
Part 2: Employers subject to §4980H of the Internal Revenue Code are required to provide an annual 1095 form no later than January 31st (unless permanently extended as currently proposed by the IRS) of each tax year to the IRS transmitting the employer required information for section 6056 for Fully Insured plans along with section 6055 for Self-Insured plans.
The information reported on Form 1094-C and Form 1095-C is used in determining whether an employer is potentially liable for payment under the ESRP provisions outlined in Part 1 above. The 1095-C information is also used by the IRS for determination of eligibility for PTC from a government run health exchange.
For more detailed information:
Notices Used in the IRS enforcement process include: 5699, 5005-A, 972CG
How should I track my employees?
All employees are tracked using one of two measurement methods the IRS released. The Monthly Measurement means that you are evaluating a window of time less than 13 weeks and ensuring coverage is offered no longer than the 91st day of employment. The lookback method allows for more flexibility when hiring variable hour or seasonal employees when the hours for which the employee is hired is unknown. The lookback window can be between 3 -12 months and what is best is always determined by current strategy. Talk to your ACA consultant about what is right for you.
How do I know if I am an Applicable Large Employer (ALE) and need to file for ACA in a given tax year?
What is an ALE?
An Applicable Large Employer (ALE) is a single employer or group of related employers who employ an average of at least 50 full-time employees (including FT equivalent employees) in the prior calendar year.
What does ACA require of ALEs?
Employer Mandate: Offer health coverage to at least 95% of full-time employees and dependents and offer minimum value/affordable coverage to full-time employees. ALEs who fail to comply risk exposure to employer shared responsibility penalties (Section 4980H).
Health Coverage Reporting: Report compliance (or lack thereof) with the employer mandate by completing Forms 1094-C/1095-C filing and distribution requirements each tax year. ALEs who fail to comply risk exposure to reporting penalties (Section 6721 & 6722).
What are the ACA filing requirements for Fully Insured vs Self Insured?
|FTE Employer Size Based on Prior Calendar Year||Fully Insured||Self Insured or Level Funded|
|Under 50 Full-Time Equivalents||No employer reporting necessary. The carrier will supply 1095B to employees generally via a portal.||Employer must report to the Employee and the IRS using a 1095B for those only enrolled in any day of the calendar month in the tax year. Pay attention to posted IRS deadlines.|
|Over 50 Full-Time Equivalents||Employer must report to the Employee and the IRS using a 1095C, Part I and II only for all employees who were Eligble for Healthcare or who made a decision in the Tax year. Pay attention to posted IRS deadlines.||Employer must report to the Employee and the IRS using a 1095C, Part I and II only for all employees who were Eligble for Healthcare or who made a decision in the Tax year. Pay attention to posted IRS deadlines.|
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