Affordable Care Act Reporting Mistakes
There are a number of mistakes—some simple and some not-so-simple—that employers should avoid to prevent receiving a panic-inducing assessment letter from the IRS. Mistake #1: Failure to Indicate that Minimum Essential Coverage Was Offered to Full-Time Employees One of the most common issues that I see is failure to indicate to the IRS that an offer of MEC was actually made to at least 95% of the employer’s full-time employees and their dependents. This will lead to an assessment of financial penalties under Internal Revenue Code (“Code)” Section 4980H. On Form 1094-C , Part III, Column (a) should be completed to indicate whether such an offer of coverage was made for all 12 months or for certain months during the year. Frequently, I have found that payroll companies will automatically default to checking the “no” box on the 1094-C, or leaving this box blank when preparing the 1094-C for their clients. Many organizations submit this Form 1094-C without carefully reviewing i...