A Plus Benefits recognizes the amount of uncertainty surrounding the Affordable Care Act (ACA) for small business owners and we remain committed to helping our clients better understand and comply with any necessary requirements. As you may have heard, a recent Supreme Court ruling upheld the ACA in its current form, which means that certain requirements put into place when it was originally signed into law in 2010 are now set to move forward.
One main area of confusion surrounds IRS Code Section 6056, often referred to as the employer shared responsibility reporting. When the news came out last fall that the employer shared responsibility requirement (also called the “employer mandate” or the “pay or play” provision) was delayed for some qualified employers with 50-99 employees until 2016, many small business owners assumed they had no new requirements for 2015, but that is not the case. While the requirement to offer minimum essential coverage to employees or face tax penalties has been delayed for certain employers in this category, there are still new tax reporting requirements that the organizations must comply with.
All employers with an average of 50 or more full-time or full-time equivalent employees during 2014 (according to IRS guidelines) are still required to perform the IRS tax reporting that applies to applicable large employers for 2015, even if they are not required to offer coverage that meets the minimum essential coverage requirements of the employer shared responsibility regulation until 2016.
In order to not face tax penalties for not offering minimum essential coverage even though you are an applicable large employer, you must meet the following requirements:
- The employer must have had on average between 50 and 99 employees (including FTEs) in 2014.
- The employer cannot have decreased the number of employees to below 99, just to meet avoid this requirement.
- Medical plan coverage offered cannot have been decreased or eliminated by the employer between February 9, 2014 and the last day of the plan year that began in 2015.
- The employer will have to complete the above reporting requirements and certify to the to the IRS that it meets the requirements listed above when they file their 1095-C form in early 2016.
Again, even if you meet these requirements and are not required to offer coverage in 2015, you must complete the tax reporting for 2015. Failing to do so can cost the company significant fines and penalties. A Plus Benefits will be reaching out to clients in the next few weeks to provide the necessary resources for them to determine which ACA tax reporting requirements apply to their company.
If you have questions about the ACA tax reporting rules, please contact us.