We offer Hassle-Free ACA Reporting
Reporting is extraordinarily complex and often requires extensive knowledge of employee benefits and the Affordable Care Act. You need to know the ins and outs of forms 1095-B and 1095-C. But with HR Service, Inc., ACA reporting is hassle-free.
All you need to do is work with your assigned ACA Expert who will ask for necessary information, then complete the reporting for you. You have the option to either mail forms yourself or to have us take care of it.
Many clients are receiving letters from the IRS for 2016 ACA Reporting, similar to what happened last year around this time for Letters 226-J for 2015. These letters are the notice from the IRS with the proposed penalty amount calculated for that company based on their past filing year.
In many instances, the estimated fines based upon a missed checked box or something simple. Other times they are triggered by employees applying for a subsidy when an employer is stating it insurance was offered.
What Determines an ALE - Applicable Large Employer?
If an employer has at least 50 full-time employees, including full-time equivalent employees, on average during the prior year, the employer is an ALE for the current calendar year. However, an employee will not be counted toward the 50-employee threshold for a month in which the employee has medical care through the military, including Tricare or Veterans’ coverage. After the approval of the Affordable Care Act (ACA), the Internal Revenue Service (IRS) updated the code to include sections 6055 and 6056, both outline the protocol of reporting ACA compliance. You are required to have your reporting completed by specific dates. If you do not do this on time, you may incur severe penalties.
2020 ACA Penalties
Employers can expect higher penalties for ACA violations, for being late, misfilings, and not properly providing coverage. The IRS has begun “aggressive enforcement of the ACA,” sending out Letter 226J penalty notices for noncompliance with the employer’s shared responsibility payment provision.
The Department of Health and Human Services issued the 2020 Notice of Benefit and Payment Parameters final rule in April 2019, and based on the inflation-adjustment factor in the final rule, compliance advisers project that the ACA 2020 penalty amounts, adjusted annually from the initial penalties set in 2014, will be as follows:
Section 4980H(a) penalty is expected to increase from $2,320 per employee to $2,500 per employee. This penalty is imposed on employers who fail to offer full-time employees and their dependent children the opportunity to enroll in minimum essential coverage sponsored by the employer if at least one full-time employee obtains a premium tax credit for insurance purchased through an ACA marketplace exchange.
The Section 4980H(b) penalty is expected to increase from $3,480 per employee to $3,750 per employee. This penalty is imposed on employers whose plan fails to meet the affordability and minimum value requirements.
Other ACA penalties, including failure to file Form 1095 with the IRS and failure-to-furnish forms to employees, are expected to increase from $260 to $270 per return.