2020 is an uncertain year, with continued wrestling over healthcare policies. The election adds an extra layer of uncertainty. ACA compliance is constantly shifting and developing, and each year seems to present a new requirement to understand.
If ACA compliance is not met when filing information returns, you may find yourself at the end of a number of penalties, which can be costly.
Read on to see the answers to a number of questions you might have about ACA compliance.
What changes should I be thinking about this year?
Most recently, the individual penalty for waiving health coverage has been eliminated. With this in mind, you may be wondering how this legislation could affect how you offer health coverage to your employees.
While individuals will not be subject to a federal penalty for not enrolling in health coverage, Washington, D.C. and a few other states have state-mandated requirements for health coverage.
How does the individual mandate penalty affect the employer mandate?
Employee classification still aligns with ACA rules. The internal classification does not have to change within your company, but employees need to offer health coverage to individuals who do meet the ACA full-time employee classification. Regardless of your own designation for health coverage among your employees, ACA regulations must always be met.
If an employee waives coverage, how does that affect my ACA compliance?
If an employee waives their health coverage, an employer still must report information to the ACA. Each full-time employee must receive a 1095-C form by January 31st, 2020. The IRS then needs to receive those forms and a corresponding 1094-C form.
Do I still need to offer health coverage to nontraditional employees?
The ACA requirement is that the number of work hours requires coverage. Eligible employees can include those who work 30 or more hours per work on average OR 130+ hours per month. This includes seasonal employees that have an F1 visa that might not otherwise be internally considered a regular worker.
How do I stay ACA-compliant?
Even if you offer the correct coverage and technically stay compliant, reporting incorrect or incomplete data will demonstrate to the IRS that you were not compliant with the ACA. This could snowball into penalties and further delays. Ultimately, even if you consider employees differently within your internal organization, you have to comply with what the ACA says.
Without properly tracking your organization’s payroll, HR, benefits, and other data, you’ll be opening yourself up for noncompliance with the ACA and potential penalties.
Don’t scramble to gather all of your information at the end of the year.
But also, consider the benefits that an e-filing service can offer:
- TIN Checking: Ensuring that TIN matches up will help to prevent delays and penalties.
- Bulk upload: With our bulk upload template, your data can be exported from accounting software and populated in the template.
- Error-checking: Our system checks your information and reports any errors in the data.
While we cannot provide tax assistance, we are very familiar with the details of your ACA forms and can help you to understand them. Get in touch to learn more.