Many Employers Unprepared for Newest ACA Reporting Requirement, the First in 72 Years
The Affordable Care Act (ACA) is one of the most significant pieces of legislation passed since the inception of Social Security in 1935. The Affordable Care Act impacts every employer, every person legally residing in the United States, every health care provider, every insurance company selling health care insurance, every pharmaceutical company, and every medical device manufacturer.
2015 is a particularly pivotal year for ACA compliance. It's the first year that recording and reporting very specific information about health care coverage is required for employers with 50 or more full-time or full-time equivalent employees. That means employers have new types of data to compile from multiple sources and systems, new forms to complete, and additional deadlines to meet. Through mandatory information reporting to their employees (on Form 1095-C) and the IRS (on Forms 1094-C and 1095-C), employers must show and certify how they complied with Shared Responsibility mandates.
This also presents employers with a tremendous opportunity to help their employees by clearly communicating about the new 1095-C (the first new tax withholding form in over 70 years), why it's important and how employees should use it when filing their 2015 taxes.
Are organizations prepared to do this? According to the 2015 ACA Study by the ADP Research Institute® (ADP RI), when asking midsized (50-999 employees) and large (1,000+ employees) organizations if they were prepared to submit Forms 1094/1095-C by the February 1, 2016 IRS due date, 44 percent midsized and 37 percent large responded they were not prepared. The percentage jumps considerably higher when asked about employees: 83 percent of employers in midsized organizations and 57 percent of employers in large organizations don't think their employees clearly understand what these forms are and how they may be related to their 2015 tax filing. The recent IRS announcement of an automatic extension in the due dates for Forms 1094-C and 1095-C gives employers slightly more time, but it's still important to be prepared to prevent a large volume of HR department inquiries and possible reruns when forms are issued.
What percentage of companies have already communicated to their employees about Form 1095-C? To find out, view our latest infographic and discover how there's no time like the present to have a strategic communications plan to help minimize in bound HR dept. call volume and reruns when forms are issued.
Enjoy the infographic and please feel free to share!
