Last Updated on November 21, 2023 by G. T. HR

How to Stay ACA Compliant in the New Year

What is the ACA?

The ACA, or Affordable Care Act, is an important part of an employer’s responsibilities. The Affordable Care Act (ACA) is the comprehensive health care reform law enacted in March 2010 (sometimes known as ACA, PPACA, or “Obamacare”).

Applicable Large Employers, or ALEs

To be ACA compliant, Applicable Large Employers (ALE) and self-insured employers are must report annually under the Affordable Care Act. More specifically, ALE’s are those with 50 or more full-time (or full-time equivalent) employees within the past year. These employers must report healthcare coverage information to the IRS and employees.

What is a Full Time Employee?

The ACA defines full-time employment status as averaging at least 30 hours of service per week or an average of 130 hours of service a month. Many businesses meet these criteria and must report healthcare coverage information to the IRS and employees.

State-Level ACA Requirement Changes

Many are aware of the Federal requirements of annual reporting for the 1094 and 1095 forms, however some states are also enacting their own health coverage reporting. Be aware that not every state follows the same reporting requirements.

For example, California, the District of Columbia (DC), New Jersey, and Rhode Island will require employer reporting of health coverage information to assist the state/district in enforcing individual health coverage mandates. In DC and New Jersey, the first reporting will occur in 2020. Reporting in California and Rhode Island starts in 2021. Always check your state law to ensure compliance.

Report your ACA

Reporting your ACA is important for your business. Don’t be fooled, some businesses mistakenly believed that ACA wouldn’t be enforced, but the IRS has sent out penalty letters for previous tax years. We’ve heard of penalties ranging from $40,000 to upwards of $2 million. Don’t let this be you.

Many Employers have similar questions about the ACA reporting requirements. We hope the following FAQ’s will address these concerns.

Frequently Asked Questions about ACA Reporting

What are my responsibilities as an employer to be ACA Compliant?

Employers required to report healthcare coverage must file one of two applicable forms, forms 1095-B or 1095-C. You may file this electronically or by mail. These forms can be found on the IRS’ website.

Do I need to file ACA reports electronically?

Yes. The IRS requires employers to file electronically if they file 250 or more returns during the year.

 Where do I go for help with filing ACA forms?

The IRS encourages employers to seek assistance through legal counsel, tax professionals, or insurance brokers when filing these forms. For more information, see the FAQs provided by the IRS. Make sure to properly fill out the forms to avoid future issues.

When are the ACA forms due?

For the 2019 tax year, the deadline for providing the forms to employees was January 31, 2020. However, we just announced that the deadline has been extended to March 31, 2020.

If the IRS changes the due date again, the update will be shared here as well.  Additionally, employers must file the forms with the IRS by February 28, 2020 (or March 31, 2020, if filing electronically).

Click here for a helpful ACA infographic (downloadable PDF) of ACA deadlines for 2020.

Get Assistance with ACA Compliance

We hope we have covered some of the questions you may have had about what must be done to make sure that you are ACA compliant. You can also access our ACA Reporting Year-end Guidance HERE. MyHRConcierge offers a service called ACACompli that helps small to mid size businesses stay compliant with the ACA.

If you have other questions, or HR concerns please contact Chris Cooley at (855) 538-6947 or email him at ccooley@myhrconcierge.