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Bookmark these pages for Form 1095-C guidance, and to give the IRS feedback on its new e-filing system
Update: Deadlines Extended for ACA Reporting
Employers subject to the Affordable Care Act’s 2015 information reporting requirements were given extra time to give these form to employees and file them with the government. In Notice 2016-4, issued by the IRS on Dec. 28, the agency extended the information reporting due dates. See the SHRM Online article IRS Extends Due Dates for ACA Information Reporting.
The IRS is in education overdrive to help HR professionals pinpoint needed compliance information as they get ready to distribute the new Affordable Care Act (ACA) forms due to employees at the end of January—at the same time W-2s are distributed.
From traditional outreach methods such as website expansion and bulk e-mail to newer sharing options with social networking on Twitter and Tumblr, IRS messages about Forms 1095-C and 1094-C reporting responsibilities are designed to get the word out—and to get feedback in.
At the center of the ACA fact-spreading campaign is a section on the IRS website published in mid-September 2015: ACA Information Center for Applicable Large Employers (ALEs). The goal, according to Bill Cressman, chief of technical communications with the IRS’s ACA Communications Office, is to catch employers’ attention and help them focus on next steps.
“The majority of employers fall below the workforce size threshold for the provisions that apply to applicable large employers,” Cressman said, referring to employers with 50 or more full-time employees, including full-time equivalents. “But many employers who are an ALE may not see themselves as an ALE. Our job is to raise awareness of the information reporting requirements and get their attention."
“We recognize we are being repetitive in the information messages that we’re getting out for employers. But the idea of just getting more and more out there is to give as much opportunity as possible for employers to come across this information and then start” preparing, Cressman added.
As HR professionals prepare for ACA reporting and seek guidance from the IRS, the IRS is seeking feedback from employers on how the reporting process can be improved.
For employers:As covered in the SHRM Online article Ready or Not, ACA Forms Due to Employees by Jan. 31, HR professionals have concerns about the ACA form beyond identifying which employees must receive a 1095-C form documenting their health benefits, and coordinating the production and submission of 1095-C forms.
Beyond what is required for regulatory compliance, HR professionals must see to a communications schedule that lets employees receiving a 1095-C form know what the new form is, and how they must use it to complete Line 61 of their individual tax returns.
For employers subject to the ACA reporting requirements, HR professionals and business owners should now be gathering data for the first quarter 2016 filing deadlines. For details, see the SHRM Online article ACA Reporting Requirements: Tips for What’s Ahead in 2016. Additional resources can be found at the SHRM OnlineHealth Care Reform Resource Page.
For the IRS:The IRS is seeking feedback on the user-friendliness of the new processing system specific to ACA returns. The system is called AIR, an acronym that stands for Affordable Care Act Information Returns.
An entire section of the IRS ACA website is devoted to this new system because ACA returns submitted electronically will not be accepted by the existing system, familiar to businesses that e-file: FIRE (Filing Information Returns Electronically).
Employers submitting copies of 250 and more 1095-C forms must e-file. The same requirement applies to coverage providers, who are required to produce 1095-B forms for recipients of their insurance.
To gather technical feedback, the IRS launched a survey in October 2015 directed at employers and coverage providers that intend to e-file on their own, and at any organization intending to e-file on their behalf.
“The thought behind the readiness survey is to find out where coverage providers and employers are getting hung up: Is it at a very high level that they don't understand? Or is it in the weeds?” Cressman said.
Among the potential “weeds” is that XML (Extensible Markup Language) is the only file format that the ACA returns processing engine will accept. In this text-based format, particular attention needs to be paid to spaces, punctuation and case sensitivity. Less complicated formats such as PDFs and Excel-based files cannot be transmitted through the AIR system.
“We encourage employers and the companies that are assisting them to visit the survey and visit it often,” Cressman said. “There's a very clear intent to take the temperature of where readiness is at, in real time, as we go through this process.”
The IRS also is steadily adding employer-focused tips to its health care tax tip series. “These tax tips are to raise the awareness that you may have a need to dig deeper,” Cressman said.
Each easy-to-read tip leads to a page with more details. Recent tips include:
• Understanding Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, Health Care Tax Tip 2015-72, November 2015.
•ACA and Employers–Know if Coverage You Offer Meets Requirements, Health Care Tax Tip 2015-68, October 2015.
•Mark Your Calendar Now: 2016 Reporting Deadlines for Employers and Health Coverage Providers, Health Care Tax Tip 2015-64, October 2015.
•The Time Is Here: Reporting Requirements for Applicable Large Employers, Health Care Tax Tip 2015-62, October 2015.
•How Coverage You Offer (or Don’t Offer) May Mean an Employer Shared Responsibility Payment for Your Organization, Health Care Tax Tip 2015-59, September 2015.
•The Importance of Workforce Size Under the Employer Shared Responsibility Provisions, Health Care Tax Tip 2015-58, September 2015.
•Questions and Answers to Help Your Organization Understand ACA Reporting Requirements, Health Care Tax Tip 2015-56, September 2015.
HR professionals who wish to have these tax tips sent to their e-mail can use this link to subscribe.
The IRS webinar links posted on the agency’s ALE Info Center are especially useful for those who wish to have even more detail. They provide more than a recording and the slide deck for each webinar. From these links, downloads are also available for a webinar transcript:
•Employer-Sponsored Health Coverage Information Reporting Requirements for ALEs.
•Information Reporting Requirements for Providers of Minimum Essential Coverage.
•Employer Shared Responsibility Provision.
With this documentation available, answers to often-asked questions such as “What are the ACA reporting requirements for commonly controlled and affiliated groups?” can be found by using keywords to search the transcript.
To extend its ACA awareness message beyond its own website, the IRS ACA communications team has posted three articles that employers can use. Each of the following links comes with this permission:
“The following article can be posted on your websites and used in other communication vehicles to help employers get the facts about the new IRS web page for applicable large employers.”
The articles are:
•New IRS Resource Helps Employers Understand the Health Care Law.
•New IRS Web Page Helps Employers Meet Reporting Requirement.
•Health Care Reporting Forms for 2015 Now Available.
Helen Karakoudas is the ACA education director at Integrity Data, a provider of HR payroll and ACA reporting software, based in Lincoln, Ill.
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