Employers who must comply with the Affordable Care Act (ACA) reporting under IRS Revenue Code Sections 6055 or 6056 should begin preparing to meet the reporting deadlines in the first few months of the new year. Two distinct categories of employers must adhere to ACA requirements:
- Employers who have self-insured health plans are required to conduct Section 6055 reporting.
- Additionally, applicable large employers (ALEs) who have health plans, whether fully insured or self-insured, are obligated to perform section 6056 reporting. ALEs are defined as employers who had 50 or more full-time employees (or the equivalent of part-time employees) in the year before the reporting period.
ACA Reporting Deadlines
Here are the ACA reporting due dates for the 2023 calendar year:
|Issue Forms 1095-C to Full-time Employees
|Issue Forms 1095-B to Responsible Individuals
|March 1, 2024 - ALEs offering self-insured coverage can use Form 1095-B or Form 1095-C for non-employees and their covered family members.
|If reporting entities opt for the alternative method, the entity must explicitly mention on its website that the responsible individuals can request a copy of their statement. If reporting entities choose not to use the alternative method, they’re required to provide responsible individuals with a copy of the statement by March 1, 2024.
|File Forms 1094-C and 1095-C with the IRS (Electronically)*
|File Forms 1095-B with the IRS (Electronically)*
|April 1, 2024 - ALEs may use either B series or C series forms to report self-insured coverage for non-employees and their covered family members.
- Note that non-ALEs without a plan or non-ALEs with fully insured plans have no reporting obligations. Non-ALEs are not subject to Section 6056 reporting and the carrier handles Section 6055 reporting.
- *Starting in 2024, entities who file 10 or more returns in a calendar year must file electronically. These entities will need to combine most information returns, including form W-2 and 1099, to calculate whether they meet the mandatory e-filing threshold of 10 returns.
ACA Reporting Penalties
In 2024, if there is a failure to comply with ACA reporting requirements, the following penalties may apply for returns and individual statements:
- General reporting penalties for not filing accurate information returns (under Code Section 6721).
- General reporting penalties for not providing accurate payee statements (under Code Section 6722).
|Corrected Within 30 Days
|Corrected After 30 Days and Before Aug. 1
- Penalties may be waived if failure is due to a reasonable cause, not neglect. Moreover, penalties may be reduced if the reporting entity corrects the issue within a specified period.
- *Small and large employers are subjected to different maximums and penalty amounts. A small employer is defined as having an annual gross receipt of up to $5 million for the last three taxable years. In case of intentional disregard, there is no limit to the penalty.
Understanding reporting timelines and the nuances of penalties for non-compliance is imperative for both small and large employers, emphasizing the importance of accurate and timely ACA Reporting.
Guidance for Employers
Staying informed and taking the necessary actions will ensure compliance with ACA reporting for IRS regulations. If you need assistance with reporting deadlines, contact your Pierce Group Benefits Account Executive or email firstname.lastname@example.org for further guidance.