Although the ongoing efforts of Congress to repeal the Affordable Care Act (ACA) has cast doubt on the controversial law’s future, the IRS’ stance is clear.
At the close of 2017, the Affordable Care Act still stands – and the IRS has sophisticated support systems in place to fully enforce it.
This means all affected employers must file 1095-C reporting forms and provide copies to employees by the IRS deadlines, or face the consequences.
To stay on schedule, these employers must meet the following tax-filing deadlines:
- February 28, 2018 — paper-filing deadline
- NEW DEADLINE! March 2, 2018 (previously January 31) — mail employee copies
- April 2, 2018 — e-filing deadline
Who Should Report under the ACA?
The ACA reporting requirements have the biggest impact on applicable large employers (ALEs) — businesses with 50 or more full-time or full-time-equivalent employees in the preceding year.
To determine if your business is an ALE for tax-filing purposes, you’ll need to distinguish between full-time and full-time equivalent employees. A full-time employee averages at least 30 hours of service per week during the calendar month, or 130 hours in a calendar month. A full-time equivalent employee represents a combination of part-time employees that, together, count as a full-time employee. (Get more guidance with the free tip sheet, Are You an Ale?)
Keep in mind, too, that an ALE may be a single entity or may consist of a group of related entities (such as parent and subsidiary, or other affiliated entities). If the combined number of full-time and full-time equivalent employees for the group is large enough to meet the definition of an ALE, then each employer in the group (called an ALE member) is part of an ALE — and subject to the ACA’s Employer Shared Responsibility provision, even if it wouldn’t be an ALE separately.
Smaller, Self-Insured Employers Must Also Report
Although they’re not classified as ALEs, smaller, self-insured companies are also responsible for ACA reporting. A self-insured company generally contracts with an insurer to administer its plan, but pays medical claims out of its own company funds.
These employers must report the name, address and Social Security number (or date of birth) of all covered individuals, including spouses, dependents and other covered individuals, on the 1095-B – along with completing the corresponding transmittal form, 1094-B.
Businesses that are not ALEs and not self-insured have no reporting obligations under the ACA.
Employers Must Act Now
If you took a wait-and-see approach with the often-debated ACA, the time to act is now. Failure to meet the deadlines for furnishing and filing ACA forms is steep. You could be penalized as much as $260 a return for late filings, with intentional disregard costing up to $530 a return.
For detailed guidance on how to prepare for ACA reporting, visit our ACA information center. Also, be sure to download the free e-guide, ACA Prepare & Report: What You Need To Know To Meet The Requirements.