Skip to main content
ACA Compliance

ACA Reporting Deadlines and Penalties Up Ahead

‘Good Faith Effort’ No Longer Applies

“Good faith effort” will not shield an employer from penalties for the 2016 ACA compliance and IRS reporting.
ACA penalty
Internal Revenue Service has posted its penalties schedule and indicated that filing incorrect returns, or intentionally disregarding filing, comes in at a $260 penalty per return, and double that amount per individual form for intentional disregard of filing. So mark your calendar—the Jan. 31, 2017 1095 deadline—the next filing benchmark– will come all too soon. (That’s about 120 days out from now!)

Accuracy Matters

What an employer should seek to achieve is the highest possible accuracy rate. Pre-validation measures are absolutely necessary to control errors, which can only be achieved through solid data. You have heard of “garbage in, garbage out.” For our clients using PSST’s ACA-Track as their reporting solution, we suggest making a list of do’s and don’ts to follow for no error results:

  • Do confirm that dates are accurate in HRIS (Human Resource Information System) and FM (financial management) systems
  • Do sync up payroll, human resources, and benefits data across divisions for proper data collection and aggregation.
  • Don’t inactivate employees instead of showing termination. The term date must be utilized in the system for accurate reporting.
  • Don’t delete health insurance deduction records.
  • Don’t leave blanks in ACA-required fields, like zip codes.
  • Don’t get creative with fields that are for ACA reporting in your existing software systems. (i.e. personnel status). This can make it difficult for PSST if you use it for other personnel notations.
  • Do make sure all employee addresses or complete and avoid typos. Review your input work.

Challenges to Accuracy

Some of the challenges to setting up accurate reporting for the IRS hover around the basic understanding of what is compliance. This includes:

  • Understanding offers of coverage made to employees
  • Making sure offers were affordable for the employee
  • Separating offers made to different employee groups
  • Conducting non-calendar year insurance plan reviews for accurate monthly data

A thorough analysis of the past is often helpful at this stage, and the advantages of a third-party administrator become apparent with this process. There will be no deadline extensions for 2017. No transitional relief. Penalties, in addition to assessments, will be implemented. “Good faith” is no longer a shield for penalties.

Looking for a reporting solution for 2016 for your company or clients? Click here to request a no-obligation demonstration of ACA-Track, a  seamless solution for the Affordable Care Act compliance and reporting.

Call Now Button