ACA Reporting Requirements

It has been a few years since ObamaCare, also known as the Patient Protection and Affordable Care Act (ACA), was passed.  It’s probably been long enough that some employers have forgotten about the reporting requirements associated with the ACA. If you haven’t taken action to initiate the information gathering needed to comply with these requirements, immediate action may be required NOW.

The ACA contains provisions that affect employers based on the size and structure of the employer’s workforce. Calculating the number of full-time equivalents (FTE), that is employees working an average of 30 or more hours a week, is the key component of determining which parts of the ACA apply.  The closer an employer is to having 50 FTE’s, the more important accurate and timely record keeping becomes. The measurements and record keeping can be very complex, especially for businesses that employ part-time or seasonal employees.

An employer’s size for the year is determined by the number of its employees in its prior year.  Employers with 50 or more FTE’s are required to offer full-time employees affordable health coverage or face stiff penalties. These employers are also responsible for new IRS annual reporting requirements. Data for the 2015 calendar year is reportable on annual forms 1094 and 1095, and must be filed with the IRS by March 31, 2016 if electronically filed. Paper filed returns are due one month earlier.  In addition to gathering traditional payroll data, employers also need to track the monthly cost of insurance offered to each employee.

Small employers (generally with less than 50 FTE’s) are not subject to the 2015 reporting provisions.  However, small employers with self-insured health plans in 2015 are subject to the more stringent reporting requirements.

If this information is not currently being compiled in an organized fashion, employers should start tracking these metrics immediately!  Many employers use their payroll service for compiling this information and filing the tax forms with the IRS. However, a number of payroll providers have experienced significant demand that they have closed enrollment into these services. For these reasons, employers should be taking immediate action if they do not have a plan in place.

Written by Patrick Wirth, CPA, CVA | Partner
Posted in Tax