ACA Reporting, aca, efiling, aca reporting, affordable care act, boomtax, 1095C, 1094C, step-by-step guide, Tax Year 2018

Prepare for ACA Reporting: A Step-by-Step Guide for TY2018

It is important that you know what information you need before you begin preparing for ACA reporting. We’ve identified the following 7 key topics that may help you to correctly and timely complete your ACA filing with our Step-by-Step Guide.

1. Identify Common Law Employees

First, you will need to identify all common law employees. According to the IRS, this is defined as anyone who performs services for you if you can control what will be done and how it will be done.

2. Identify Full-Time Employees

The IRS has very specific guidelines regarding what qualifies as a full-time employee.

You can find additional help in calculating the number of full-time employees through the IRS Taxpayer Advocate Service.

3. Verify Employee TIN Information

It is crucial to verify the taxpayer identification numbers (TIN) of your employees in order to avoid having to file corrections, re-issue forms to employees, and potential penalties from the IRS.

Tools such as TINCorrect can help you verify TIN information for your businesses and employees before you file.

4. Confirm Threshold Satisfaction of ACA Requirements

According to the IRS provisions, applicable large employers (ALEs) are required to offer at least 95% of full-time employees minimum essential coverage that is affordable and provides minimum value to their full-time employees and their dependents. Failing to do so may leave you subject to employer shared responsibility payments.

In previous tax years, transition relief was available for some ALEs under section 4980H. However, for the 2018 tax year, no such transition relief will be available.

5. Determine Which Affordability Safe Harbor to Use

To put it simply, provided coverage is considered affordable if the premium constitutes less than 9.69% of the household income of an eligible employee.

Since household income can be difficult to determine, due to factors such as spousal or secondary income, the IRS offers three safe harbor options to assist in determining affordability.  

6. Determine a Contact Option for Form 1095-C Employee Questions

If your employees have questions regarding their 1095-C forms, they should have a good calling number to address their concerns.

7. Self-Insured Plans: Identify Individuals and Gather Information for Form 1095-C

For self-insured plans, you will need to identify the covered individuals (employee and dependants) and their social security numbers. You can use a date of birth if you have made a reasonable attempt to obtain the social security numbers but were unsuccessful.

It is a good idea to gather this information as early as possible. It can be difficult to gather all of the necessary information from your employees in a timely manner.

Need additional information?

Check out our Knowledge Base for answers to our most popular questions. You can also contact us at [email protected]

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