The ninth annual ACA open enrollment period started on November 1, 2021, and it runs through January 15, 2022. This period is longer than it has been previously. Because of that, we also wanted to run through the latest changes and updates for ACA 2022. Changes to Choices and Premiums As with previous years, marketplace premiums are changing for 2022. They will be about 3% lower than 2021. 32 more insurers are participating in the marketplace next year as well, bringing the total to 213. According to KFF, consumers in the marketplace will have a choice of almost 83 health plans in 2022, up from 46 plan choices in 2021. The American Rescue Plan Act also changed the healthcare marketplace plans and premiums. ARPA, among other things, extended eligibility for premium tax credits to include people with income levels more than 400% of the federal poverty level (FPL). When broken down, consumers on these plans end up contributing a maximum of 8.5% of their income toward the benchmark silver plan. Active Renewal Is Your Best Bet If you or your employees are currently enrolled in a 2021 marketplace plan, you can let the Open Enrollment period pass and you will automatically be moved to a similar plan for 2022. But active renewal is still your best bet when it comes to ACA 2022. If you allow the marketplace to passively enroll you in a similar program to previous years, you may end up paying more in monthly premiums because the 2022 ARPA changes aren’t optimized for your ideal plan. Extremely Low-Income Enrollment For individuals with very low income levels (up to 150% FPL), a new monthly enrollment opportunity will be available. These opportunities will include zero-premium plans with greatly reduced deductibles. State-Based Marketplaces This year, three states have launched state-based marketplaces in Kentucky, Maine, and New Mexico. The Future of ACA Marketplace Enrollment Due to a special COVID-based enrollment period that ended in August of …
ACA Penalties & Deadlines for Tax Year 2020
The IRS issues penalties for employers who do not comply with the Affordable Care Act (ACA) Employer Mandate. For the 2020 tax year, the penalties have increased. What are the ACA penalties? Monetary penalties for filing late If you file ACA forms to the IRS after the deadline, you will be charged a minimum of $50 per return. At maximum, you may be charged $550 per return filed late. The amount increases by the number of returns not filed and the length of time it takes you to file them after the deadline. According to ACA Times, if you file late for tax year 2020, you can expect to pay the following penalty amounts: $50 per return filed late if you file within 30 days of the deadline; the penalty amount will not exceed the annual maximum, $556,500 $110 per return filed late if you file 31 or more days late, but before August 1, 2021; the penalty amount will not exceed the annual maximum, $1,669,500 $270 per return filed late when filed after August 1, 2021; the penalty amount will not exceed the annual maximum, $3,339,000 $550 per return if the IRS believes that you are intentionally disregarding this mandate; the penalty amount for this has no annual maximum However, if your gross receipts for the past three years are $5 million or less, you would be charged the same penalty amounts with lower annual maximums. Penalties for failing to comply with the ACA Employer Mandate According to Freeman Law, there are two types of penalties for employers who disregard the ACA Employer Mandate: A. When an applicable large employer (ALE): Does not offer coverage Offers coverage to less than 95% of its full-time employees and their dependents Has at least one full-time employee who receives a premium tax credit to help pay for coverage through a Marketplace Exchange B. When an ALE offers coverage to at least 95% of its full-time employees and their dependents, but at least one full-time employee receives a premium tax credit to …
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How to File ACA Forms to the IRS
Similar to other tax forms, you can file Affordable Care Act forms by paper or electronically. What are ACA Forms? Affordable Care Act (ACA) forms, also known as ObamaCare forms, report healthcare plan coverage information to the IRS and employees. Employers with 50 or more full-time employees, all self-insured employers, and some insurance companies must file this form. How to File ACA Forms If you have less than 250 ACA forms to file, you can submit paper copies. If you have more than 250 ACA forms, then you need to file electronically using the Affordable Care Act Information Returns (AIR) system. ACA Forms Due Dates You must deliver 1095 forms to your employees by January 31. If you are filing by paper, you must do so by February 28. If you are e-filing, you must do so by March 31. E-filing Benefits Choosing to e-file your ACA forms, even if you have less than 250 ACA forms to file, has many benefits: You have an additional month to file compared to paper filing. You can correct errors by using TIN Checking before you file. Receive an immediate e-filing submission status; it will be “accepted,” “accepted with errors,” or “rejected.” Receive a dated Receipt ID that verifies your submission, which is beneficial if your business receives an IRS Letter 5699, which identifies potential non-filers of the required ACA Information Returns. Troubleshooting E-filing Issues In order to e-file using the AIR system, you must first apply for a Transmitter Control Code (TCC). The application requires your business’s details, including your EIN, as well as the details of two business officials, at minimum, who will be transmitting the information. The application also requires what type of transmission methods you will use. After the application is submitted and it’s accepted by the IRS, the business needs to go through an ACA Assurance Testing System. This test determines whether your business’s technology will ensure that all e-filing will take place …
Deadlines refresher—they’re coming up!
Are you ready for this year’s tax season? As an applicable large employer (ALE), you are required to e-file if you employ 20 or more employees. Are you familiar with the changes to the tax season? The IRS has granted an extended deadline to this year’s tax season (not likely to happen again soon). Non-Box 7 1099-MISC IRS forms and ACA forms can be e-filed up to March 31st, 2020. If recipients don’t electronically access their forms, eFile360 sends the recipient a paper copy (while paper filers need to remember different dates, the IRS recommends e-filing anyway). In order to submit your forms on time, consider an electronic delivery service. With eFile360, you can ensure that your forms are e-filed on-time and accurately. Employer Correction Requests are also known as “no-match” letters,” and the Social Security Administration (SSA) has begun sending them out to employers whose records have mismatched names and Social Security Number (SSN) combinations. This follows a seven-year hiatus, prompting employers to make sure they are submitting tax forms accurately. Electronic filing dates to remember: ACA DATES IRS eFile: March 31st 1095/1094-B 1095/1094-C 1099 DATES IRS eFile: March 31st, 2020 1099‑B 1099-DIV 1099‑INT 1099‑S 1099‑R E-filing will help to reduce the hassle of tax season. In order to avoid the potential delays and hassles that could be caused by receiving a no-match letter, consider the benefits offered by TIN Checking. Before your forms are submitted, TIN Checking ensures that SSNs and names match. A simple typographical error could land you much more trouble than it’s worth. If you’re a business that files both electronically and by paper, eFile360 also provides services that can help to streamline and automate how the recipient receives their forms. In addition, it’s important to know which forms you should send. Let’s talk if you’d like to learn more about how our e-delivery tax solution can …
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New 2020 deadlines for 1099 and ACA forms
This year, the IRS has granted an extended deadline: recipient copies can be distributed electronically up to March 2nd. The typical deadline for receiving tax forms is typically January 31st, but that doesn’t mean you should sit back and relax. Understanding the new deadlines and how you should submit those forms can reduce the chances for penalties, delays in submission, and prevent you and your business from experiencing an expensive and time-consuming world of hurt. ALEs and e-filing If you are an ALE (applicable large employer) or employ 20 employees or more, you must file electronically. However, e-filing will not only help to open up time for other important endeavors and ease your mind about the potential for penalties, but will also ease the hectic environment of tax season. You won't have to worry about paper, either. 1099 form deadlines: 1099 MISC Recipient copy: January 31st, 2020 IRS Paper Filing and eFiling (Box 7): January 31st, 2020 IRS Paper Filing (Non-Box 7): February 28th, 2020 IRS eFiling (Non-Box 7): March 31st, 2020 Other 1099 form deadlines: Recipient copy: February 15th, 2020 1099‑B 1099‑S Recipient copy: January 31st, 2020 1099-DIV 1099‑INT 1099‑R IRS Paper Filing: February 28th, 2020 1099‑B 1099-DIV 1099‑INT 1099‑S 1099‑R IRS eFile: March 31st, 2020 1099‑B 1099-DIV 1099‑INT 1099‑S 1099‑R 1098 form deadlines Recipient copy: January 31st, 2020 1098 1098-T IRS Paper Filing: February 28th, 2020 1098 1098-T IRS eFile: March 31st, 2020 1098 1098‑T ACA form deadlines Recipient copy: March 2nd 1095-B 1095-C IRS Paper Filing: February 28th 1095/1094-B 1095/1094-C IRS eFile: March 31st 1095/1094-B 1095/1094-C Paper filers need to remember different dates Paper forms are acceptable for businesses that employ between 50 and 249 individuals. Still, the IRS strongly recommends electronic …
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Answers to your ACA compliance questions
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 …
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