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Presented by: Heather DeBlanc

ACA Reporting Requirements for Large Employers California Association of Joint Powers Authorities (CAJPA) Annual Conference | September 17, 2015. Presented by: Heather DeBlanc. ACA Reporting Requirements. Two Types of Annual Reporting . Insurer Reporting

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Presented by: Heather DeBlanc

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  1. ACA Reporting Requirements for Large EmployersCalifornia Association of Joint Powers Authorities (CAJPA) Annual Conference | September 17, 2015 Presented by: Heather DeBlanc

  2. ACA Reporting Requirements

  3. Two Types of Annual Reporting • Insurer Reporting • Self- insured plan sponsors / insurers • Applicable Large Employer Reporting (Forms 1094C & 1095C) • Incl. employers that sponsor self-insured plans • Both require written statement to Employee/responsible individual

  4. Purpose of the Applicable Large Employer Reporting Requirements • Inform IRS of large employer compliance with Employer Mandate • Determine eligibility for exchange subsidies (aka premium tax credits)

  5. Method/Deadline of Filing • Data from prior year (2015 data reported in 2016 for first annual filing) • More than 250 returns, must e-file: • By Mar 31 (2016 first filing) • Less than 250 returns, can: • By Feb 28, hard copy filing; or • By Mar 31, e-file (optional) • Written statement to each employee reported on due on or before Jan 31 (first due 2016)

  6. Who Must Report?

  7. Who Must Report? • Health insurers and plan sponsors of self-insured plans must report coverage of enrolled individuals • “Applicable large employers” as defined by the ACA must report offer of lowest cost coverage • Plan sponsors that are also large employers must report both covered individuals and offer of lowest cost coverage

  8. Plan Sponsors of Self-insured Plans • Sponsors of single employer plans • Employer must report • Special rule for government employers • Written Agreement (employer with self-insured plan and another related unit, agency, instrumentality) • By Jan 31 • Designated agency is sponsor for reporting

  9. “Applicable Large Employers” • Information reporting requirements only to large employers • 50 or more full-time employees, including FT equivalents • Must report even if taking advantage of 50 to 99 FT employee transition relief for 2015

  10. Applicable Large Employer (ALE) • Each ALE member • Special rule for government employers • Written Designation (signed by ALE member & designee) • Specific language required • Designated by Jan 31

  11. IRS Forms and the Reporting Process

  12. Required Returns • A return is required each year for each full-time employee on whom reporting is required (Form 1095) • Single transmittal to IRS of all returns for the year (Form 1094 = transmittal) • Report information regarding type of coverage offered and applicable transition relief

  13. Reporting Penalties • Failure to timely file correct return • Good faith compliance sufficient for 2016 • $250 per return (up to $3,000,000) • Failure to timely provide correct written statement to employee • $250 per statement (up to $3,000,000) • Intentional disregard of filing requirements • $500 per return (no calendar year cap)

  14. Determining Forms to File

  15. Form 1094-C

  16. IRS Transmittal Form 1094-C • Transmittal form for employers filing 1095-C • Content • Name and contact information of employer • Total number of Forms 1095-C submitted • Offered minimum essential coverage • Number of full-time employees per month • Total employees per month

  17. Form 1094-C – Parts I and II

  18. Designated Governmental Entity (DGE) – Lines 9-16 • Person or persons part of or related to the governmental unitthat is the ALE Member • File separate Forms 1095-C and 1094-C • Must have written designation by Jan. 31 incl: • Category of employees responsible for reporting • Agreement/Certification of designation • Acknowledgment of responsibility • Identify ALE member as subject to penalties

  19. Authoritative Transmittals – 1094-C, Part II, Line 19

  20. DGE Example – Page 2 of Reporting Instructions • County is an ALE • ALE Members: School District, Police District, and County General Office. • School District designates the state to report on behalf of the teachers and reports for itself for its remaining FT employees. • The School District or the state must file Authoritative Transmittal

  21. Authoritative Transmittals • Filing multiple Forms 1094-C permitted • Filed by each separate employer (aka ALE Member) • Line 19 of 1094-C • Reporting aggregate employer-level data

  22. Authoritative Transmittal w/ DGE • Designated Governmental Entity • Must also designate one of the multiple Forms 1094-C as the authoritative transmittal and report the aggregate employer-level data for the government unit

  23. Line 20 – 1094-C, Part II • Employer’s full-time employees that are filed with this transmittal • To be filed with another transmittal filed by or on behalf of the employer • Non-full-time employees who enroll in the employer’s employer-sponsored self-insured health plan

  24. Line 21 – 1094-C, Part II • Employer’s full-time employees that are filed with this transmittal • To be filed with another transmittal filed by or on behalf of the employer • Non-full-time employees who enroll in the employer’s employer-sponsored self-insured health plan

  25. Line 22 – 1094-C, Part II

  26. Qualifying Offer Method (Box A) • Qualifying Offer • Affordable under Federal Poverty Line safe harbor • Employee’s self-only premium contribution to lowest cost plan option not more than 9.5% of the monthly Federal Poverty Line • Offer of coverage to spouse and dependents • Check if using for one or more full-time employees

  27. Qualifying Offer Made For Any Month • If Qualifying Offer made for any month, Employer: • May report code 1A on Form 1095-C, line 14 instead of the dollar amount on line 15; can’t do both • Can use code 1A for any single month or all 12 calendar months • Check Box A if you are doing this

  28. Qualifying Offer Method (Box A) • If Qualifying Offer for all 12 months, ER may provide simplified notice to employee: • ER name, address, EIN, contact name & info; • Statement: For all 12 months the employee and his/her spouse and dependents received a “qualifying offer” and is therefore not eligible for a premium tax credit. • Not available for self-insured reporting • If Qualifying Offer NOT made for all 12 months, ER must provide copy of Form 1095-C unless Transition Relief applies

  29. Line 22 – 1094-C, Part II

  30. 2015 – Qualifying Offer Transition Relief (Box B) – 2015 ONLY To use, large employer mustcertify it made a Qualifying Offer: • For one or more months • To at least 95% of full-time employees

  31. Qualifying Offer Transition Relief (Box B) – 2015 ONLY • Check if made qualifying offer for one or more months of 2015 to at least 95% of full-time employees • For employees who do not receive Qualifying Offer for all 12 months, incl. those receiving no offer • Simplified reporting permitted

  32. Qualifying Offer Transition Relief (Box B) – 2015 ONLY • Employer name, address, and EIN • Contact name and telephone number at which the employee may receive information about the offer of coverage (if any) and Form 1095-C filed with IRS • Statement indicating employee and his or her spouse and dependents may be eligible for a premium tax credit for one or more months of 2015 • A statement directing the employee to see Pub. 974 for more information on eligibility for the premium tax credit

  33. Line 22 – 1094-C, Part II

  34. Section 4980H Transition Relief (Box C) • Applicable large Employer with less than 100 FT ee (incl. FTE); or • Calculation of Penalties (i.e. 70% as substantially all; less 80) • To take advantage of these, check this Box & complete Form 1094-C, Part III, column (e)

  35. 98% Offer Method (Box D) • Certify on Form 1094-C that a “98% offer” was made • At least 98% of all employees (including part-time) were offered affordable, minimum value coverage • Affordable under any affordability safe harbor • Not required to separately identify or report number of full-time employees in Part III, Column B of 1094-C (still must file 1095-C for each full-time employee)

  36. Form 1094-C – Part III

  37. Form 1094-C – Part III Info to calculate Penalty A – not offering to substantially all FT employees • (column a) Yes if offered to 95% or 70% of FT employees (as to ea. month or line 23) (*No – red flag for penalty trigger) • (column b) Skip if using 98% Offer Method • (column b) Enter # FT ee’s (don’t include ee in a Limited Non-Assessment Period)

  38. Limited Non-Assessment Period • Not subject to penalties during the period • EE must be offered affordable MV coverage by first day after end of period • New FT – first 3 full calendar months • Look Back Safe Harbor – Initial MP + Admin period for new variable hour, seasonal, pt ee. • Change in status

  39. Form 1094-C – Part III (column c) Total employee count – first or last day of month (consistent each month of year) • include all whether in LNP, PT, FT (column d) Penalty A is total # FT ee less 30 (80 in 2015). If this column is checked, the employer is related to a larger group and penalty calculation will be with regard to whole aggregate group. If enter X for any month, complete Part IV.

  40. Form 1094-C – Part III (column e) Use if completed Box C on line 22 (4980H Transition Relief) • Code A – 50-99 relief; OR • Code B – 100 or more relief

  41. Form 1095-C

  42. IRS Reporting Form 1095-C • Who: Applicable large employers • What: Report information regarding type of coverage offered and applicable transition relief • How: • One Form 1095-C for each full-time employee • One Form 1095-C for any employee who enrolls in coverage (if employer sponsors self-insured health plans)

  43. Form 1095-C

  44. Penalty Reminder – Reporting Trigger Remember IRS Potential Penalty, if do not OFFER: • MEC (Minimum Essential Coverage) • MV (Minimum Value) • To substantially all full-time employees • 70% (in 2015); 95% (2016 & beyond) • AND dependents (i.e. children up to age 26)

  45. Form 1095-C – Part II

  46. Indicator Codes – Form 1095-C, Line 14 – Offer of Coverage 1A. MV MEC to FT ee affordable based on 9.5% FPL plus MEC to spouse & dependents 1B. MEC MV to ee only 1C. MEC MV to ee + MEC to dependents (not spouse) 1D. MEC MV to ee + MEC to spouse (not dependents)

  47. Indicator Codes – Form 1095-C, Line 14 – Offer of Coverage 1E. MEC MV to ee & MEC to dependents & spouse 1F. MEC NOT MV to ee, or ee + spouse or dep., or ee, spouse & dep. 1G.Offer to ee (not FT) & enrolled in self-insured coverage. 1H. No offer of coverage. 1I. Qualified Offer Transition Relief

  48. Line 15 – Form 1095-C • Employee’s share of lowest cost monthly premium only for self-only minimum value coverage • Complete only if Line 14 has Code 1B, 1C, 1D, or 1E • Complete if offered coverage • Do not complete if coverage was not MEC • Do not complete if coverage offered did not provide MV

  49. Line 16 – 1095-CApplication of 4980H Safe Harbor 2A. EE not employed during month 2B. EE not FT 2C. EE enrolled in coverage offered 2D. EE in Limited Non-Assessment period 2E. Multiemployer interim rule relief 2F. Form W-2 Safe Harbor 2G. FPL Safe Harbor 2H. Rate of Pay Safe Harbor 2I. Non-Calendar Year Transition Relief (2015)

  50. Multi-Use Indicator Codes – Form 1095-C, Line 16 • 2B • Not FT EE; did not enroll in MEC • FT, but offer of coverage ended before last day of month because employee terminated employment during month • Jan. 2015 if offered affordable MV coverage no later than first day of first payroll period beginning Jan 2015

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