Monday, November 10, 2014

Implementation of Affordable Care Act (ACA)

Implementation of Affordable Care Act (ACA)
Under the Affordable Care Act (ACA), both:
  • health insurance providers and 
  • "large employers" who have: 
    • 50 or more full-time equivalent employees 
      • FTE = 30 hours per week or 130 hours per month 
have new reporting requirements to ensure they are meeting health care coverage obligations. The information reporting obligations are meant to provide policy details for each person who is provided with coverage to the IRS. At the end of the year, taxpayers and their dependents must be able to prove that they were participating in a qualified health plan, thereby producing a need for third-party tax information reporting.

IRC §6056 requires employers to report to the IRS information about their compliance with the employer shared responsibility provisions, including the type of health care coverage they offer to their employees. In addition, employers are required to furnish related benefit statements to employees to assist them in determining whether they can claim a premium tax credit on their tax return.

IRS Form 1095-C (Employee statement) and a Form 1094-C (Transmittal) are the proposed designated forms to be used for §6056 reporting. Use the following links to view a draft of each of these forms:
Form 1095-C
Form 1094-C

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