With all the news around health care and the ACA coming out of Washington these days, it can be easy to find yourself stressing about how that will affect you and your clients this tax season. You've got enough to worry about so we're here to help provide you with a calm and stress-free survival kit to the ACA reporting this year.
So sit back, sip that chamomile tea, and let us guide you in a relaxed tone about what to expect this tax season for ACA.
Deep breathe in and exhale out. Ahh.
Let's start with some reassuring words from the Office of Chief Counsel to the Department of Treasury. They remind us that "legislative provisions of the ACA are still in force until changed by the Congress, and taxpayers remain required to follow the law and pay what they may owe." Simply put, you still need to file ACA forms similar to last year.
Great! We're all good there.
Now we'll happily discuss those forms and who is required to send them.
The ACA Employer Shared Responsibility provision requires certain employers to file annual information returns with the IRS, as well as provide summary statements to employees. Simply put, most companies will need to file ACA forms with the IRS.
Here's who has to file ACA forms and why:
If you have 50 or more full-time employees and/or full-time equivalents (part-time employee hours that add up to a full-time employee) your business is considered an Applicable Large Employer (ALE)
There is less reporting responsibility for smaller businesses, which the ACA defines as those with fewer than 50 full-time employees.
Specifically, the Employer Shared Responsibility rule requires covered employers to file annual 1095 forms with the IRS and send summary statements to employees to verify that "minimum essential coverage" is being met.
Which forms need to be filed?
Fully insured applicable large employers must complete Parts I and II of the 1095-C for each full-time Employee (and the 1094-C transmittal form).
Self-insured applicable large employers must complete Parts I, II, and III of the 1095-C for each full-time Employee (and the 1094-C transmittal form). They will also have to provide information on other covered individuals, such as retirees and former employees on COBRA.
Part I: Employee; Applicable Large Employer Member
Part II: Employee Offer and Coverage (including Plan Start Month)
Part III: Covered Individuals
Are you calm as a cucumber yet? We're going to break down what sort of information goes on those 1095-C and 1094-C form.
1095-C Information needed:
- Who is a full-time employee each month
- Employee information such as name address and SSN
- Employer information such as name, address and Employer Identification Number
- Information bout the health coverage offered by month
- Employee's share of the monthly premium for the lowest-cost, self-only minimum value coverage
- Months the employee was enrolled in coverage
- Months the employer met the affordability safe harbor with respect to an employee and whether other relieve applies for an employee for a month
- If the employer offers a self-insured plan, information about the covered individual's enrollment in the plan by month
1094-C Information needed:
This form represents the total 1095-C filings submitted for the season.
- Organization's information such as name, address and Employer Identification Number
- Information about whether the organization offered coverage to at least 95% of its full-time employees and their dependents
- Total number of 1095-Cs issued to employees
- Information about members of the aggregated applicable large employer group
- Full-time employee counts by month
- Total employee counts by month
- Whether an organization is eligible for certain transition relieve (including certifications)
Because the employee's name and health insurer appear on the same form, the data is considered protected health information. Using a simple solution that is SOC-certified and HIPAA-compliant, such as EagleViewFiling.com, can provide an added layer of protection with this type of data. Doesn't that give you warm fuzzies knowing an account with Eagle View is a safe one?
The good news doesn't end there. If you're in need of more time for filing your 1095 forms to the IRS then you can file Form 8809 for a 30-day extension. No signature or explanation is necessary for this extension. You can also request a 30-day extension for providing forms to employees but that is only available by sending a signed letter to the IRS with the reason for the delay. But still, it's an option.
Let's end this with the happiest news of alldeadlines. Yes, this should all make you happy because if you know the deadline and you have a plan to make it then it should all be smooth sailing form there. (Nod head in agreement)
Wednesday, January 31, 2018:
Employers are responsible for furnishing their employees with Form 1095-C
Wednesday, February 28, 2018: (If filing by paper)
Employers are responsible for filing 1095-C to the IRS along with 1094-C summary form
Monday, April 2, 2018: (If e-filing)
Employers are responsible for e-filing 1095-C to the IRS along with 1094-C summary form
Take a final deep breathe in. Hold it. Hold it. And exhale. Ahhh.