Products Partners Blogs Contact Let's talk There will be no additional extensions for ACA reporting in 2022 Nov 19, 2021 Employers should make sure they and their service providers are ready to give employees with health care reporting forms and submit them to the IRS on time, according to the IRS. Deadline extensions will not be granted for 2022. The ACA requires large applicable employers (ALEs) to submit reporting forms to the IRS and distribute them to workers. What Are ALEs? An applicable large employer is any entity that employed an average of at least 50 full-time employees on business days during the preceding calendar year. This definition applies to what entities are subject to the Affordable Care Act (ACA) by virtue of their status as an employer. This calculation excludes all employees who work 30 hours or fewer per week, which are generally not counted toward establishing coverage eligibility by ACA standards, and also excludes all employees under age 18 who have not yet graduated from high school, because they often have access to family coverage outside of employment. Anyone falling into these categories should consult with a specialist in labor law for relief options before abandoning their job because it does not meet ACA requirements for coverage eligibility. ACA Deadlines: Jan. 31, 2022 1095 Forms delivered to employees Feb. 28, 2022 Paper filing with IRS* March 31, 2022 Electronic filing with IRS Over time, the IRS has often prolonged these deadlines, according to legal counsel at Jackson Lewis in Baltimore. "In the past, such extensions were intended to help businesses adapt to the new regulations. Most recently, a further extension was announced in Notice 2020-76 for plan year deadlines to account for COVID-19 epidemic difficulties." On October 2, 2020, the IRS released Notice 2020-76. This delayed the deadline to provide Forms 1095-C and 1095-B from January 31, 2021, to March 31 of 2021. As of yet, there has been no news on a 30-days extension for the 2022 filing, which is not unexpected given that we haven't seen an announcement a whole month after the initial one. We may only presume that the deadline for 2022 has not been extended, implying that it will fall on January 31, 2022. This deadline is for people to receive 1095-B and 1095-C forms. February 28, 2022 is the due date for those who want to submit paper copies, while March 31, 2022 is the due date for those who wish to submit electronically. Notice 2020-76 provided relief from the requirement to send hard copies of ACA reporting forms to people. But this relief was only for plan year 2020 coverage in 2021. The IRS has not yet issued the penalties for late reporting in 2022. Filing with incorrect information, for example, using the wrong codes or TIN, may result in a penalty. You may also be fined if you submit late without providing an acceptable excuse, or if you file with the incorrect medium. "No such extension has been announced (nor is expected) for reporting in the first quarter of 2022," Thomas wrote. This implies that employers subject to the ACA's reporting provisions should work internally or with their extraneous suppliers to meet these dates. "Employers should not expect any extensions and should work hard to complete their reporting forms on time," says Danielle Capilla, vice president of compliance, employee benefits, at Alera Group, a network of insurance and financial services businesses. Employers often prefer to distribute 1095 forms to workers along with their W-2 tax forms, as both are due on Jan. 31, according to Ms. Vassiliadis. ACA Reporting Forms The IRS has released final versions of ACA forms for reporting on plan year 2021 coverage. Transmittal Forms: 1094-B- for filing Forms 1095-B to the IRS. 1094-C- for filing Forms 1095-C to the IRS. Reporting Forms: 1095-B- used by insurers and small, self-funded employers to provide exact enrollment information of employees and family members enrolled in minimum essential coverage. 1095-C- used by ALEs, whether fully insured or self-funded, to detail their offer of coverage so as to avoid potential employer mandate penalties. For each full-time employee, provided to each employee and submitted to the IRS. Self-insured ALEs must also file a Form 1095-C for any part-time employees who are enrolled in coverage. ACA Requirements: The employer fines levied against ALEs that do not provide required coverage to full-time employees under the statute's shared responsibility provisions are still in effect. By submitting forms with the IRS and providing copies to workers, ALEs demonstrate they offered eligible staff health insurance that complied with the ACA. Employers with 50 or more full-time workers must provide coverage to all their employees that meet the required levels of affordability and minimum value. They are subject to penalties if they do not comply. Employers with less than 50 full-time workers are not obligated to offer health insurance, but if they wish to do so, it must fulfill ACA requirements As regards furnishing annual ACA information forms to employees: Fully insured plans are offered by ALEs to employees: In response to a request from the IRS, all insurance carriers must furnish copies of Form 1095-B to covered individuals in addition to the Form 1095-C they receive from the ALE. If a carrier is taking advantage of the providing relief described below, it must also provide Watchdog with a copy of each form. Self-insurers: All of the information required by the Affordable Care Act for ALEs is collected in the Form 1095-C, and individuals who are not covered will not be sent a Form 1095-B. Smaller organizations (non-ALEs) that sponsor self-insured plans: These are not required to furnish Form 1095-B to covered individuals, but they are required to send them a 1095-C if they comply with certain conditions. Penalties The IRS has the right to penalize you for failing to file your tax return on time. Late or incorrect forms might result in the IRS telling an employer it may be held responsible for a penalty payment. For failing to provide correct Form 1095-C or 1095-B information to an employee, the IRS can fine up to $280 per form. A separate $280 per form penalty may be imposed for each missing form filed with the IRS, resulting in a potential $560 per employee penalty. The above penalties are for incorrect reporting and are separate from ACA penalties for inadequate coverage: ALEs that fail to offer minimum essential coverage to at least 95 percent of their full-time employees and dependents are facing a $2,750 penalty per employee, or $229.17 per month for the 2022 tax year, under Section 4980H(a). The determined amount will reduce 30 full-time employees from the total number of full-time employees. The Section 4980H(b) penalty, which is assessed for each employee who receives a premium tax credit/subsidy from a state or federal ACA marketplace exchange when the ALE does not provide a coverage option that meets the affordability threshold, is anticipated to be $4,120 per person or $343.33 per month for the 2022 tax year. The IRS sends a Letter 226-J to notify ALEs that they may be required to pay an employer shared responsibility payment. The Bottom-Line To summarize, the Affordable Care Act (ACA) requires large applicable employers to submit reporting forms and distribute them to their employees. The IRS will not extend any deadlines for 2022 when it comes to ACA reporting requirements. This means that you should make sure your employer is ready by 2022 in order to avoid penalties from the IRS. If you need help to determine which of these entities are subject to this requirement or if you want assistance with designing a compliant plan before 2022, feel free to contact us today! We’d be happy to provide an analysis of what we can do for you and offer our advice on how best to meet your needs moving forward. Build and manage a better workforce with integrated HR solutions from ADP Marketplace partners like Points North. Newer Post > < Older Post Certified Payroll Reporting LEARN MORE ACA Reporting LEARN MORE Payroll Data Aggregation LEARN MORE Attendance Advisor LEARN MORE What to Consider When Applying for a Government Contract Did you know the US government spent more than $680 billion on contracts in fiscal 2020? This is the highest contractual spending by the federal government on record. Securing a government contract can have a tremendous impact on your business growth. In fact, the government can become the best clients you've ever had business with. Government contracts have many benefits. They range from good pay, reliable income, long contracts to high business value. However, securing a government contract is easier said then done. There are lots of regulations, procedures and rules dictating how to transact with the government. Your business must navigate through the complex bidding process and pass. Don't forget the stiff competition with many businesses seeking a healthy revenue stream. While there are many hurdles, it doesn't imply your business can't win the bid. But are there considerations to make when applying for a government contract? Keep reading to find out. OPEN ENROLLMENT FOR 2022 PLAN YEAR HAVE BEGUN The 2022 federal open enrollment period began last week and will continue until January 15, 2022. Consumers will be able to pick from a number of plans, as well as lower prices. According to a news release from the Centers for Medicare and Medicaid Services (CMS), there will be 213 participating insurers selling plans for 2022 year. We'll find the right solution for you. We'll help you decide on the best solution for your company. Simply click the button below to fill out a form or just give us a call today. 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