ACA reporting is something every employer has to deal with if they offer health insurance benefits under the Affordable Care Act (or ACA, as you may have guessed).
But, what exactly is ACA reporting, does your company need to do it, and are there any extensions? Keep reading to find the answers to all of these questions.
(If you have more concerns regarding administering health benefits to your employees, professionals at NY Small Health will be happy to demystify the whole benefits process for you).
Now, on to the four things all employers need to know about this year's ACA reporting instructions.
1. Who needs to do the reporting?
The short answer? ALE's or Applicable Large Employers with 50 or more full-time employees during the previous year. ACA reporting is necessary to monitor company compliance with the ACA Employer Mandate, which directs ALEs to offer affordable minimum essential coverage to more than 95% of their full-time employees. Non-compliance to these reporting and coverage requirements could result in IRS penalties.
2. 2021 ACA reporting deadlines
There are two deadlines relating to ACA reporting. These deadlines are annual and typically stay the same every year (much like your income tax deadlines):
Statements must be furnished to all individual employees who receive minimum essential coverage by Jan 31.
Apart from the individual statements, returns must be filed with the IRS by Feb 28 (or Mar 31 for online filing).
3. Extensions for furnishing deadlines.
The IRS extended the deadline for reporting entities to furnish statements to individuals by an extra 30 days. However, they generally encourage companies to provide these statements to employees as soon as possible. Note: Forms 1094-B, 1095-B, 1094-C, & 1095-C need to be filed with the IRS by the above deadline - there is no extension for this due date.
4. Section 6055 or 6056?
Is your company a health insurance provider? Or does your business offer self-insured health plans? Then, Section 6055 will apply to your company, and you will likely have to use Form 1094-B and 1095-B. On the other hand, ALE's fall under Section 6056 and generally use Forms 1094-C and 1096-C to report their health coverage offerings (or lack thereof) to their full-time staff.
Staying compliant is a big deal, even for small companies. Your firm's ACA reporting requirements could vary, depending on:
the number of employees you hire,
the health benefits you provide, and
the type of business you run.
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