It is midway through 2015 and the Employer Mandate has arrived. This provision of the Affordable Care Act (also known as the “Play or Pay” provision) requires all employers with 50 or more full-time equivalent employees to offer a certain level of health insurance coverage at an affordable rate to all full-time employees or face a possible penalty.
Large employers (those with 100 or more full-time equivalent employees) that do not comply with the Employer Mandate may begin incurring penalties in each month of the 2015 tax year. Midsize employers (those with 50-99 full-time equivalent employees) enjoy an additional year of reprieve (to 2016) as long as the organization did not reduce its workers’ hours/workforce to get below the 99 employee threshold without a bona fide reason or materially reduce its health care plan as it existed on February 9, 2014.
It’s important to note that the IRS will only apply Employer Mandate penalties to an organization if the employer is subject to the Employer Mandate, fails to comply with the Mandate, and has at least one full-time employee shop in the Marketplace and receive a federal premium subsidy.
With the implementation of the Employer Mandate comes new IRS reporting requirements. Employers subject to the reporting requirements must complete and submit one Transmittal Form (IRS Form 1094-C) for the organization and one Employee Statement (IRS Form 1095-C) for each employee. Employers that sponsor a self-funded health plan have additional reporting requirements.
Anxiety is understandably high in regard to both the Employer Mandate and the new IRS reporting requirements associated with the Mandate. The penalties have the potential to be substantial for some employers, and the regulations are somewhat tedious and technical. Some anxiety can be mitigated utilizing Coastal Payroll’s ACA Compliance Package and by reviewing the “Navigating the Employer Mandate” guide in your HR Support Center.
Coastal Payroll’s ACA Compliance Package offers the configuration of benefits plans, enrollment data, filing 1094/1095 forms, etc. Together with reviewing the guide in your HR Support Center that provides sample penalty calculations, IRS reporting requirements and much more, your business falls perfectly in line with compliance.
For more information on Coastal Payroll’s HR Support Center and ACA Compliance Package, contact us at info@coastalpayroll.com.