Is there a communication gap in your ACA reporting strategy?

Submitted by ChloeS on Mon, 02/29/2016 - 00:32
communication gap

The Affordable Care Act (ACA) has given employers plenty of challenges, so when the IRS released Notice 2016-4 on December 28, 2015, extending the deadlines for the upcoming 1095 reporting requirements, it was welcome news. Here’s a quick refresher on the deadline extensions:

  • The deadline for providing employees and individuals with 2015 Form1095-C (Employer-Provided Health Insurance Offer and Coverage) or Form 1095-B (Health Coverage) has been extended to March 31, 2016.
  • The deadline for filing Form1095-C or Form 1095-B has been extended to May 31, 2016 if filing by paper, and to June 30, 2016 if filing electronically.

But even though these deadlines have been pushed back, they’ll be here before you know it.

Do you and your employees have all the information you need to understand and meet the new requirements?

Unfortunately, many are still scrambling. According to the ADP Research Institute, 52 percent of midsized businesses and 45 percent of large employers still aren’t sure if they’re at risk of violating ACA compliance requirements this year, and nearly one in five employers thinks they’re at risk of not being in compliance with Form 1095-C requirements. Two out of five employers say they’re unfamiliar with the 1095-C forms altogether.

With so many questions and so much uncertainty, there’s obviously a communication gap. Make sure you’re staying up to date on the new reporting requirements and other changes in the law with reliable sources such as:

Employers aren’t the only ones with questions

As you prepare to distribute the 1095-C or 1094-C forms to your employees, keep in mind that the ACA and its new regulatory requirements can be just as confusing for them, and they’ll likely have questions about the new forms. Make sure they understand that information about their health coverage is now an important part of the tax filing process. Give them a heads up about the extended filing deadlines, and let them know that while they may not receive their 1095-C form by the time they file their 2015 tax return, they can rely on information they’ve already received from you outlining whether they’re enrolled in employer-sponsored coverage. Point them toward resources to stay in the loop such as Obamacarefacts.com - Form 1095.

It’s last call, and the stakes are getting higher

The IRS made it clear in the Notice that there will be no more extensions, so employers need to make sure they’re getting their ducks in a row now. On top of that, the IRS has recently increased the penalties for reporting errors with Forms 1094-C and 1095-C including non-filing, late filing, or missing or incorrect information – and they can be substantial. One way to reduce your exposure to these costly penalties is to verify the names and Social Security numbers of employees in your benefits system with the names and Social Security numbers in your payroll system.

With the new reporting requirements and so much at stake this year, keep yourself and your staff informed so you can close any communication gaps and stay on top of the changing laws.

Need help? VisitHeffernan’s Benefits Advisory Services and contact us today.