Overview
The Affordable Care Act (ACA) requires insurers and certain large employers to file new information returns in connection with employer-provided healthcare coverage.1 A failure to comply may result in substantial penalties. The new information returns require a significant amount of monthly data on each employee (and the employee’s dependents), including employment data, whether the employee received an offer of coverage, and whether the employee and the employee’s dependents are enrolled in coverage.
Many employers, insurers, and vendors (and even the IRS) are experiencing difficulties in collecting this information and preparing the systems and procedures necessary to report it. With the filing deadline fast approaching, some companies now face significant obstacles to filing complete and accurate information returns. The IRS has announced that it will waive penalties for 2015 for reporting entities that make a “good faith effort” to comply, but this raises important questions. What level of compliance constitutes a “good faith effort” to file the new information returns? Can an incomplete or inaccurate form still result in a good faith effort? And what if the good faith effort standard is not satisfied?
Click here to read more.
1 For additional details regarding reporting requirements and forms see “Penalties Double for Failure to File New IRS Information Returns Under the ACA,” posted August 26, 2015.