IRS REQUIREMENTS

The ACA is full of tricky IRS requirements that are difficult to keep organized. There are two important factors to consider when figuring out which forms (if any) to complete: the size of your business, and whether your health care plan is fully-insured or self-insured. To determine your company size, be sure to use your average monthly full-time equivalent count for the preceding calendar year (i.e. for 2017 size, use 2016 counts). If you are unsure whether your plan is fully-insured or self-insured (self-funded), click here to learn more or contact your plan administrator.

Use the information below to help determine your specific reporting requirements.

 REPORTING FORM REQUIREMENTS

2-49 Full-Time Equivalents (Small Employer)

  • Fully-Insured Plan – No Reporting requirement.
  • Self-Insured Plan – File a Form 1095-B for each subscriber to your medical plan (include all dependents covered under that subscriber in Part IV).
  • Form 1094-B – All transmittals to the IRS must also include this Employee-Level Transmittal Form.

50+ Full-Time Equivalents (Applicable Large Employer)

  • Fully-Insured Plan – File a Form 1095-C for each employee who was full-time at any point during the reporting year; only complete Parts I and II.
  • Self-Insured Plan – File a Form 1095-C for each employee who was full-time at any point during the reporting year and for each subscriber to your medical plan. Fill out Parts I and II for all full-time employees and subscribers. Complete Part III for each subscriber enrolled in your medical plan and all dependents covered under that employee or subscriber.
  • Form 1094-C – All transmittals to the IRS must also include this Employer-Level Transmittal Form.

REPORTING REQUIREMENTS FOR
ALE – aka AGGREGATED LARGE EMPLOYER or CONTROLLED GROUP – MEMBERS

If your controlled group has an aggregate of 50+ full-time equivalent employees, you must file as an ALE, even if your entity has fewer than 50 full-time equivalents. Regardless of controlled group status, you are only responsible for reporting on the full-time employees who were employed under your EIN. All members of your Aggregated ALE Group, however, must be disclosed in Part IV on your Form 1094-C, which is the Employer-Level Transmittal Form.

POTENTIAL PENALTIES

Employer Shared Responsibility Penalties

  • Failure to Offer Health Coverage to 95% of Full-Time Employees – $2,160 per Full-Time Employee
  • Failure to Offer Affordable Coverage – $3,240 per Employee Receiving Premium Tax Credit

Incorrect Information on Returns

  • Inaccurate or Late Filing – $260 per return; not to exceed $3,178,500 per year
  • Intentional Disregard – $520 per return; no maximum
MZQ is not a law firm and cannot dispense legal advice. Anything contained in this communication is not and should not be construed as legal advice. If you need legal advice, please contact your legal counsel.