Employer Reporting Requirements under ACA By: Arthur Tacchino, JD Chief Innovation Officer SyncStream Solutions, LLC

Code §6056 – Applicable Large Employer and Offering Employer Reporting Code §6055 – Reporting for Employers that Self-Insure W-2 Reporting Reporting Requirements

§ 6056 Reporting Effective beginning in 2015 – Delayed 1 Year – Early voluntary compliance is acceptable “Applicable Large Employers” must report, whether they offer coverage or not – An employer that employed 50 or more full-time equivalent employees in the preceding year – Controlled group rules apply for determining A.L.E. Status*

A.L.E. Status Each Month throughout 2014: – Identify full-time employees – Aggregate hours of service by anyone not full-time – Divide aggregate hours of service by 120 – Add the number of full-time employees to the number of equivalent employees to determine the average number of full-time equivalent employees the employer employed that month

Example January 2014 – 45 full-time employees – 15 part-timers that worked 1,200 hours throughout the month – 1,200 aggregate hours / 120 = 10 equivalent employees – 10 equivalent employees + 45 Full-time employees = 55 Full-Time Equivalent Employees

When does employer report? The actual report will be much like W-2 reporting By January 31 st of the following year Practically speaking the report would be delivered in January of 2016 with 2015 plan information

What does employer report? the employer’s name, date, and employer identification number (EIN); a certification of whether the employer offers its full-time employees and their dependents the opportunity to enroll in “minimum essential coverage” under an eligible employer-sponsored plan the number of full-time employees the employer has for each month during the calendar year; the name, address, and taxpayer identification number (TIN) of each full-time employee employed by the employer during the calendar year and the months (if any) during which the employee and any dependents were covered under a health benefit plan sponsored by the employer during the calendar year; and any other information required by the IRS

The statute also requires that employers that offer the opportunity to enroll in “minimum essential coverage” must also report the months during the calendar year for which coverage under the plan was available; the monthly premium for the lowest-cost option in each of the enrollment categories under the plan; the employer’s share of the total allowed costs of benefits provided under the plan; and in the case of an employer that is an applicable large employer, the length of any waiting period with respect to such coverage

Who gets a report? The employer is responsible to furnish a report for the IRS, as well as a statement to their full-time employees which includes: – the name, address, and contact information of the reporting employer; and – the information required to be shown on the return with respect to the individual *Currently the IRS is trying to “simplify” reporting

Penalties for Noncompliance Employer becomes subject to penalties for failure to file an information return and failure to furnish payee statements Employer shall pay a penalty of $100 for each statement with respect to which such a failure occurs, but the total amount imposed on such employer for all such failures during any calendar year shall not exceed $1,500,000

§ 6055 Reporting Effective beginning in 2015 – Delayed 1 Year – Early voluntary compliance is acceptable Code § 6055 requires insurers, sponsors of self-insured plans, and other entities that provide minimum essential coverage to an individual during a calendar year to comply with this reporting requirement

When does employer report? The actual report will be much like W-2 reporting By January 31 st of the following year Practically speaking the report would be delivered in January of 2016 with 2015 plan information

What does employer report? the name, address, and taxpayer identification number (TIN) of the primary insured,65 and the name and TIN of each other individual obtaining coverage under the policy; the dates during which the individual was covered during the calendar year; if the coverage is health insurance coverage, whether the coverage is a qualified health plan (QHP) offered through a health benefit Exchange; if the coverage is health insurance coverage and that coverage is a QHP, the amount of any advance cost-sharing reduction payment or of any premium tax credit with respect to such coverage; and any other information required by the IRS

In addition, under the statute, if health insurance coverage is through an employer-provided group health plan, the return must contain the following information: the name, address, and employer identification number (EIN) of the employer maintaining the plan; the portion of the premium (if any) required to be paid by the employer; and any other information the IRS may require to administer the new tax credit for eligible small employers under Code § 45R

Who gets a report? The employer is responsible to furnish a report for the IRS, as well as a statement to their full-time employees which includes: – the name, address, and contact information of the reporting employer; and – the information required to be shown on the return with respect to the individual *Currently the IRS is trying to “simplify” reporting

Penalties for Noncompliance Employer becomes subject to penalties for failure to file an information return and failure to furnish payee statements Employer shall pay a penalty of $100 for each statement with respect to which such a failure occurs, but the total amount imposed on such employer for all such failures during any calendar year shall not exceed $1,500,000

Measurement, Administrative, and Stability Periods These new tracking requirements will dictate, who is “full-time”, therefore, who should be offered coverage Systems must be put in place

W-2 Reporting Became effective in W-2 Exemption still in place Employers required to report the aggregate cost of employer sponsored coverage on the employee’s W-2 Still informational only reporting

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