Health Care Law: Highlights for Applicable Large Employers

Health Care Law: Highlights for Applicable Large Employers


HI, I’M PHYLLIS, AND I WORK FOR THE
INTERNAL REVENUE SERVICE. THE HEALTH CARE LAW HAS SOME TAX
REQUIREMENTS THAT APPLY ONLY TO CERTAIN EMPLOYERS,
THOSE CALLED APPLICABLE LARGE EMPLOYERS,
OR ALEs. THE VAST MAJORITY OF EMPLOYERS
ARE NOT ALEs, BUT IT’S IMPORTANT TO DETERMINE EVERY YEAR IF
YOU ARE AN ALE SO YOU KNOW WHICH REQUIREMENTS WILL APPLY
TO YOU THE FOLLOWING YEAR. YOUR ALE STATUS WILL DETERMINE
YOUR HEALTH CARE REPORTING AND COVERAGE REQUIREMENTS. WE HAVE A LOT OF HELP AND MORE
DETAILS FOR YOU ON IRS.GOV/ACA, BUT HERE ARE SOME HIGHLIGHTS. YOU ARE AN APPLICABLE LARGE
EMPLOYER IF YOU AVERAGED 50 OR MORE FULL-TIME EMPLOYEES,
INCLUDING FULL-TIME EQUIVALENTS, IN THE PREVIOUS CALENDAR YEAR. AS AN ALE, YOU’RE REQUIRED TO
REPORT INFORMATION ABOUT THE HEALTH COVERAGE YOU OFFER,
OR CHOOSE NOT TO OFFER, USING FORM 1095-C. YOU’LL SEND THIS STATEMENT TO
EMPLOYEES AND FILE IT WITH THE IRS. IF YOU DIDN’T OFFER COVERAGE TO
YOUR FULL-TIME EMPLOYEES AND THEIR DEPENDENTS OR THE COVERAGE
THAT YOU OFFERED DID NOT MEET CERTAIN CRITERIA,
YOU MAY BE SUBJECT TO AN EMPLOYER SHARED
RESPONSIBILITY PAYMENT. THIS PAYMENT APPLIES ONLY IF
ONE OF YOUR FULL-TIME EMPLOYEES RECEIVES THE PREMIUM TAX CREDIT,
OR PTC, AND ONE OF THE FOLLOWING SITUATIONS APPLIES TO
YOUR ORGANIZATION. YOU DIDN’T OFFER COVERAGE TO
YOUR FULL-TIME EMPLOYEES AND THEIR DEPENDENTS. YOU OFFERED COVERAGE THAT
WAS NOT AFFORDABLE, OR YOU OFFERED COVERAGE THAT
DIDN’T PROVIDE A MINIMUM VALUE. YOU DON’T HAVE TO CALCULATE
THE PAYMENT OR INCLUDE IT ON ANY RETURN YOU FILE. THE IRS CALCULATES IT BASED
ON INFORMATION FROM YOU AND YOUR EMPLOYEES. WE’LL CONTACT YOU IF WE
BELIEVE A PAYMENT MAY BE DUE, AND YOU WILL HAVE A CHANCE
TO RESPOND BEFORE WE ACTUALLY ASK FOR THAT PAYMENT. YOU MAY HAVE QUESTIONS ABOUT
THESE TAX REQUIREMENTS AND HOW, OR EVEN IF,
THEY APPLY TO YOU. YOU CAN FIND THE ANSWERS AT
IRS.GOV/ACA.

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