ACA Reporting Penalties to Increase
Congress recently passed the Trade Preferences Extension Act of 2015. The Act significantly increases penalties for reporting failures under several sections of the Internal Revenue Code, including the Patient Protection and Affordable Care Act (ACA) reporting using Internal Revenue Service Forms 1094 and 1095.
As employers are well aware, the ACA requires all large employers to report detailed information concerning their workforce and group health plan coverage offerings. These reports are due in early 2016, and cover the 2015 calendar year. Penalties may be imposed for incomplete, incorrect or failed reporting.
Penalties for ACA reporting failures (such as failing to file by the deadline, failing to provide required information, or failing to provide correct information) will increase from $100 to $250 per return. The yearly cap on total penalties will also increase, from $1.5 million to $3 million. “Intentional disregard” of the filing requirement may result in a penalty of $500 per return, and the cap on total penalties will not apply.
AFAS and Worxtime Can Help!
American Fidelity Administrative Services, LLC (AFAS), an American Fidelity Corporation affiliate, offers a WorxTime service to assist with this reporting. WorxTime will capture the necessary information, create the required forms, and distribute the information directly to each employee and to the IRS. Note: The deadline to request a statement of work is August 31, 2015 in order for us to assist with the reporting due in early 2016.
Some products and services may be provided by third party contractors or affiliated companies.
Neither AFA or AFAS provide tax or legal advice and, given the complexity of federal health and welfare plan rules, we always recommend working with your own legal counsel to discuss how your plans could be affected and to review any guidance provided by our us.