News & Articles

IRS Extends Deadline to Provide 2016 ACA Forms to Recipients

Posted on Fri, Dec 02, 2016

The IRS announced that it is extending one of the deadlines for providing 2016 Affordable Care Act (ACA) information statements to recipients.

Specifically, the due date for furnishing to individuals the 2016 Form 1095-B (Health Coverage) and the 2016 Form 1095-C, (Employer-Provided Health Insurance Offer and Coverage) is extended from January 31, 2017, to March 2, 2017.

Q&As about the Process and Extended Due Date

What about filing these statements with the IRS? Is there an extension? No. The deadline for filing the forms with the IRS is not being extended. The IRS has determined that there's no similar need for additional time for employers, insurers, and other providers of minimum essential coverage to file 2016 Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS. The filing deadline for these returns remains February 28, 2017, if not filing electronically, or March 31, 2017, if filing electronically.

However, the extension in IRS Notice 2016-70 doesn't affect the provisions regarding automatic and additional extensions of time for filing information returns, which remain available under the normal rules by submitting Form 8809, Application for Extension of Time to File Information Returns.

Who must furnish these statements? Health insurance issuers, sponsors of self-insured health plans, government agencies that administer government-sponsored health insurance programs, and other providers of "minimum essential coverage" must generally file annual returns reporting information for each individual for whom such coverage is provided. An entity filing an information return reporting minimum essential coverage to the IRS must also furnish a written statement to each individual listed on the return that shows the information that must be reported to IRS for that individual.

The ACA also requires applicable large employers (generally, employers with at least 50 full-time employees, including full-time equivalent employees in the previous year) to provide the individuals with Form 1095-C.

Why are these statements provided to employees? The purpose of this reporting is to allow taxpayers to establish, and for the IRS to verify, that the taxpayers were covered by minimum essential coverage and their months of enrollment during a calendar year.

Why is the deadline being extended? The IRS decided to extend the deadline following consultation with stakeholders and the Department of the Treasury, as a substantial number of employers, insurers and other providers of minimum essential coverage need additional time. The extension is automatic.

Do businesses and others need to do anything to take advantage of the extension? No. The extension is automatic. No documentation needs to be submitted to receive the extension from the IRS.

Penalty Relief

The IRS is also providing the same penalty relief that it provided with respect to 2015 returns. IRS Notice 2016-70 extends the good-faith penalty relief from penalties for failure to timely furnish and file the information returns from the 2015 tax year to the 2016 tax year. In determining good faith, the IRS will take into account whether an employer or other coverage provider made reasonable efforts to prepare for reporting the required information to the IRS and furnishing it to employees and covered individuals.

Examples of good faith include gathering and transmitting the necessary data to an agent to prepare the data for submission to the IRS, or testing the ability to transmit information to the IRS. In addition, the IRS will take into account the extent to which an employer or other coverage provider is taking steps to ensure that it will be able to comply with the reporting requirements for 2017.

The IRS is encouraging employers and other coverage providers that don't meet the relevant due dates to still furnish and file. The IRS will take such furnishing and filing into consideration when determining whether to abate penalties for reasonable cause.

The Future

IRS Notice 2016-70 states the tax agency doesn't anticipate extending this transition relief — either with respect to the due dates or with respect to good faith penalty relief — to reporting for 2017. However, as indicated in presidential election campaign promises, there could be major changes to the ACA under the Trump administration.

If you have questions about your ACA responsibilities under the Affordable Care Act, contact your EHTC tax, payroll or employee benefits advisor.

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Tags: Affordable Care Act (ACA), IRS, IRS Filing, Affordable Care Act

Employer Penalty Alert for Reimbursing Employee Health Coverage

Posted on Tue, Dec 16, 2014

The Affordable Care Act (ACA) established a number of so-called "market reform" restrictions on employer-provided group health plans, starting with plan years beginning in 2014. These restrictions generally apply to all employer-provided group health plans -- including those furnished by small employers with less than 50 workers. Even worse, there's a punitive penalty for running afoul of the market reform restrictions. The penalty, under Internal Revenue Code Section 4980D(b)(1), equals $100 per-day per-employee, which can amount to up to $36,500 per-employee over the course of a full year. Yikes!

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Tags: Tax, Healthcare, EHTC Article, IRS, ACA, Newsletter, Articles, Affordable Care Act

Paying Employees to Buy Health Coverage? Know the Ground Rules

Posted on Tue, Dec 02, 2014

Does your company's health insurance plan include health reimbursement arrangements (HRAs) or flexible spending accounts (FSAs)? If so, you should know these plan components are both subject to the Affordable Care Act (ACA) and its "market reform" provisions. The Department of Labor and other principal agencies have issued another round of guidance1 to answer some of the frequently asked questions about health care reform, including questions about the use of HRAs and FSAs.

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Tags: Healthcare, EHTC Article, HRAs, FSAs, DOL, Newsletter, Articles, Affordable Care Act

Get Ready for Upcoming Affordable Care Act Compliance Deadlines

Posted on Fri, Oct 31, 2014

Just around the corner is an immediate deadline imposed by the Affordable Care Act (ACA), November 5, 2014. Fortunately that is not a difficult one to fulfill. The requirement is to get a "health plan identifier number," or HPID. Small plans -- those through which less than $5 million flows in a year, have a November 5, 2015 deadline. The requirement pertains to the government's desire to simplify HIPAA compliance monitoring. For that, you will need to consult with an accounting professional for details.

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Tags: Healthcare, EHTC Article, Affordable Care Act (ACA), Healthcare Law, Health Insurance, IRS, ACA, Newsletter, Articles, Affordable Care Act

New for 2014: Penalty for Not Complying with the Individual Mandate

Posted on Tue, Feb 11, 2014

Starting this year, a provision in the Affordable Care Act generally imposes a penalty on individuals who fail to carry so-called minimum essential health insurance coverage. The requirement to carry such coverage is often called the individual mandate, and the penalty is the cost for failure to comply with the mandate. This article explains who owes the penalty, how the penalty is calculated (it's complicated!) and how an individual will be expected to pay it. 

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Tags: EHTC Article, CPA Firm, Affordable Care Act, Individual Mandate, Penalty Basics

Get Ready for ACA Changes Coming Your Way This Year

Posted on Tue, Dec 31, 2013

With all the delays, website malfunctions, and general confusion surrounding the Affordable Care Act, you may have the misguided impression that little of significance will change in 2014. Such a notion needs to be corrected. Read on, to learn key provisions which kick in for plan years beginning with 2014.

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Tags: Changes in ACA, CPA Firm, Affordable Care Act, Employer Pay-or-Play Penalty, EHTC

IRS Fine Tunes the Small Employer Tax Credit for Healthcare Costs

Posted on Tue, Sep 24, 2013

Providing healthcare coverage is difficult for many small employers but they may get a tax break for some of the costs. The IRS recently issued proposed regulations fine-tuning the rules governing the healthcare tax credit available to certain small employers, beginning in 2014. The Affordable Care Act includes a credit for eligible employers of up to 50% of premiums. This article explains what the new proposed regulations add to the mix.

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Tags: Healthcare, Tax Credit, Echelbarger, Affordable Care Act, EHTC, Tax Adviser, Small Employer

Which Employers Must Pay the New 'PCORI' Fee Due July 31?

Posted on Mon, Jul 15, 2013

Some employers face a July 31 deadline to pay a new fee required under the Affordable Care Act. The fee must be paid by employers who sponsor self-insured health plans, including health reimbursement arrangements and flexible spending arrangements. The new requirement may take some employers by surprise -- and, of course, there are penalties for failing to comply. This article explains what the federal government will use the money for and which employers must pay it.

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Tags: PCORI fee, IRS, business consulting, Echelbarger, Affordable Care Act, EHTC

Healthcare Law Deadlines in Place, Coming Up & Delayed

Posted on Mon, May 06, 2013

Most employers are aware that, starting January 1, 2014, there will be a penalty for some employers if they don't offer affordable health insurance coverage to employees who work a certain number of hours a week. But under the Affordable Care Act (ACA), employers face numerous other provisions and deadlines. This article briefly explains three provisions involving healthcare flexible spending accounts, group plan waiting periods and the new Small Business Health Options Program.

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Tags: Healthcare Law, New Law, business consulting, Articles, Echelbarger, Affordable Care Act, EHTC