Q&A with Debbie: ACA is Still Here, So Reports Are Coming Due

The Affordable Care Act (ACA) is with us for at least another year, it seems, so it’s time to make sure you’re prepared to file the required reports.

In addition to the act’s famous individual mandate, it includes an incentive for employers with 50 or more full-time equivalents (FTEs) to provide group health insurance. Those that don’t must pay a penalty of up to $2,260 per employee per year.

Those same employers must also provide a new tax form, 1095-C, to each employee and to the IRS, with a deadline looming in January.

The good news is, first, that there are no new requirements this year. If you were in compliance last year and you’re in the same size category, just do the same things this year. The other good news is that if you’re a Savers Admin payroll customer, we’ll do almost everything for you. We’ll send you a census based on your payroll data, and once you’ve checked it, we’ll do the rest.

Here are some frequently asked questions about the requirements:

Q.  I am a small employer. Do I have to provide any forms to my employees?

A.  It depends on the size of your workforce. If you had 50 or more full-time equivalent employees in the previous year (2016), you are required to provide your full-time employees a 1095-C form for 2017.

Q.  How do I calculate full-time equivalent employees?

A.  If, in a given calendar month, an employee works 30 or more hours per week or 130 hours total, he or she is full-time for that month. Add all your monthly full-time employees and divide by 12 and you have your count for the year. Your payroll provider should be able to do this for you.

Q.  What information is required on the 1095-C?

A.  Each employee receives his or her own 1095-C. Beyond the usual name, address and social security number, the level of detail depends on the nature of your health plan. The key questions are, is your plan self-insured or fully insured? And is it considered “affordable” under an IRS formula?

This gets complicated. Remember we’ll do it for you if you’re a customer. If you have questions, by all means call or email us.

Q.  When are the forms due to employees?

A.  January 31, 2018.

Q.  When are the forms due to the IRS?

A.  If filing by paper, the due date is Feb. 28, 2018.  If filing electronically, the due date is March 31, 2018.  Electronic filing is mandatory for employers with 250 or more forms.

Q.  What are the penalties for late filings?

A.  $250 per form up to a maximum of $3 million.  The penalty is doubled if forms are late to both employees and the IRS.  All penalties are at the discretion of the IRS.