Tuesday, January 31
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ACA Reporting Requirements for Employers

health insurance

The Affordable Care Act (ACA) mandates a minimum level of health insurance coverage for all employees and their families at all applicable large employers (ALEs). As an employer, you should report the coverage to the IRS annually. Failure to file in due time will attract penalties. You will file the returns using forms 1094 and 1095. 

Who Is Subject to ACA Reporting?

Employers with employees who get their insurance from the business must report those employees’ health coverage. You should file this under section 6055 of reporting. 

The government expects all applicable large employers (ALEs) to report their Affordable Care Act coverage to their employees. An ALE is any employer with 50 or more full-time employees or their equivalent.

A full-time employee works more than 30 hours a week for the company. An equivalent of a full-time worker would be two employees, each working 15 hours weekly. 

The government has the equivalent of a full-time worker provision to prevent employees from only using part-time workers to avoid qualifying as an ALE. You should carefully evaluate your company to know if you fall into the category.

You should provide forms 1094 and 1095 for ACA and other documents, such as the form 1099-Misc for miscellaneous income, when you file your taxes. Visit https://blog.boomtax.com/essential-guide-form-1099-misc/ to learn more about form 1099-Misc.

ACA Reporting Deadlines 

You must file your reports on time to avoid getting fined by the IRS. The government provides various dates that each employer should observe when filing their taxes. The dates are as follows:

  • February 28th: All employers filling their taxes on paper should do so by this date.
  • March 2nd:  Employers should provide their employees with statements indicating the offered coverage.
  • March 31st:  If you are electronically filing their taxes should do so by this date.

If any dates fall on a weekend or a public holiday, you should file the taxes by the next business day.

Form 1095-C

The form contains information on the health insurance coverage the employer offers their employees. You must provide each employee with information about their cover for the entire year.

The form has three parts, each containing different information. They are as follows;

  • Part I – Contains your essential information as an employer. The details include Your address, name, and phone number.
  • Part II- The sections indicate the health coverage you give to the employee and any employee-required contributions.
  • Part III – Contains information on the employees and their dependents covered by the health plan.

You should send these forms to the IRS and provide each employee with a copy containing their coverage.

Form 1094-C

Form 1094-C provides a summary of forms 1095-C. You only send this document to the IRS; you don’t need to give the employees a copy. 

The form contains your address, Employer Identification number, and phone number. It also includes the number of employees in your company and the number of 1095-C you send.

Keep in Mind

You should always file your taxes on time. Ensure you understand all the documents you should file. If you have difficulties filling out documents, use online resources to improve your understanding.

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