The IRS has proven over the last several months that they are actively enforcing the ACA by issuing letters to Applicable Large Employers (ALEs) who may have failed to comply with Affordable Care Act. Since the IRS is fully engaged in the Affordable Care Act audit process, it is more important than ever for US employers to mitigate their risk of being audited.
There are numerous factors that could potentially
Identify Employees that are Full-Time and Benefit Eligible
By now, most ALEs understand that employees who work 30 or more hours per week or average more than 130 hours per month are considered full-time and eligible for coverage. In order to
Offer Quality Coverage to Full-Time Employees
Once an ALE has identified all of its full-time, eligible employees, it is important to extend offers of coverage at the correct time. Also, in order for employers to be in compliance with the ACA’s
Generate and Audit 1095-C Forms for Accuracy
ALEs must provide 1095-C forms to all full-time eligible employees at the end of each year. This form requires information such as whether each employee was offered health insurance, at what cost, and of what quality. One of the main triggers of an IRS audit is filing inaccurate data. Therefore, it is equally important for employers to review the 1095-C forms for accuracy before they are distributed. There are many different 1095-C code combinations for various coverage scenarios. You may want to
Meet the IRS 1095-C Mailing Deadline
Employers must be sure to furnish accurate 1095-C forms to their employees by the IRS deadline. Failure to comply with the IRS deadline cannot only make you vulnerable to auditing, but it can also subject you to potential
Audit Form 1094-C
The key to avoiding an IRS audit is being pro-active about auditing and reviewing your information before it is sent to the IRS. Here are a few key items to review when auditing your 1094-C form:
- Ensure company name and EIN are correct.
- Also be sure that your affiliated ALE members are listed in Part III (if applicable).
- Ensure that the authoritative transmittal box is checked (Line 19) for each EIN for which you are reporting.
- Ensure that the “Minimum Essential Coverage Offer Indicator” (Part III, Column a) is accurately checked for all 12 months or appropriate months.
- Generally, if you offer an MEC plan, this should be marked “Yes” for All 12 Months – Individual months are then left blank.
- Ensure that the month full-time employee counts are correct (Part III, Column b), *unless you have selected the 98% Offer Method.
Meet the IRS 1094-C Filing Deadline
The IRS will be expecting a 1095-C form for every full-time employee, (or all those insured if you are self-insured) AND form 1094-C. These forms must be filed by the designated deadlines. Employers who are paper filing these forms needs to file these forms by February 28th, 2019. Employers using the