If you’re ready, good for you. But chances are you haven’t even begun to worry about the new Affordable Care Act reporting requirements.
It’s just not something that can linger on the back burner. IRS Code Sections 6055 and 6056 need attention before January 2016. The code requires that every business with an average of more than 50 full-time equivalent employees—or any business that was self- or partially self-funded in 2015, no matter how many employees it has—will need to distribute employee notices by the last day of January and file transmittals and returns for each employee by the last day in February of 2016.
To be clear, that is Monday, February 29. A little more than four months away as I write this. Failure to make a “good faith” effort at this requirement will result in $100 fines “per occurrence” up to a maximum of $1,500,000.
Nothing to sneeze at, is it? And so I’m harping on this issue again. It’s big, and you do really need to think about it now.
Staying informed of all changes to federal and state HR requirements is a job in and of itself; therefore, most employers who do not employ a dedicated HR specialist or have an HR department tend to be much more reactive than proactive in the arena of human resource administration and compliance. I get that. But this just can’t fall through the cracks.
Here’s what to expect: Two different transmittal and return forms will be required. Use Forms 1094-C and 1095-C for all groups over 50 Full-Time Equivalents, and Forms 1094-B and 1095-B for all groups self-funded and under 50 Full-Time Equivalents. If a group is self-funded, it will be required to report on all covered dependents as well, most commonly through Section III of the 1095. Producing these forms with the appropriate “indicator codes” in the proper boxes, you will need accurate data on covered employees and qualified offers of coverage by month.
If you are confused, irritated, or feel as though you may be short on data to deal with this upcoming pain, I encourage you to find a reliable consultant or vendor who can assist with the immediate concern of making a “good faith” effort this year. After we all get through this initial trial run, I encourage all businesses and business owners who are managing variable hour or part-time employees and employing anywhere near 50 folks to find a reliable and automated system to deal with the tracking of data and ACA reporting.
It’ll be smooth sailing after that. Well, until the next additions or changes are made.