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Employers should plan on IRS 1095c reporting for 2017

August 14, 2017

By Lori Stewart, SPHR®, SHRM-SCP, HCS, Partner, Human Resources Consulting

Many human resource and payroll managers working for applicable large employers (ALEs) have been closely following the news since President Trump was inaugurated for signs of change regarding the Affordable Care Act (ACA) IRS 1095c reporting requirements. At this point, no such change is likely to be reported for this tax year.

When President Trump’s first executive order was directed to regulatory agencies to ease the burden of the ACA, there were reasons for employers to anticipate change in January of this year. As he worked with Congress to repeal and replace the health care law, this raised the hopes of many ALEs, who consider the ACA Employer Shared Responsibility mandate, ACA/IRS reporting responsibilities, and possible subsequent penalties to qualify, as burdensome.

However, in June 2017, the IRS weighed in on the meat of this Executive Order, in Information Letter No 2017-0010, which clarified the true impact for ALEs concerned about the Employer Shared Responsibility provisions. The IRS stated the ACA law did not provide for the waiver of any Employer Shared Responsibility penalties. Further, President Trump’s Executive Order did not change the law, and the legislative provisions of the ACA are still in force until changed by Congress.

That IRS information letter was a disappointment for some ALEs who later anticipated Congress would act in July to repeal and replace ACA with a health care law that included no Employer Shared Responsibility mandates. This was also unsuccessful as the Senate vote on an ACA replacement bill failed at the end of July.

In August, Senate leadership has made it clear they are moving on and are working on legislation such as tax reform. They are not planning to reintroduce health care legislation this year.

Therefore, as the IRS lectured in their June 2017 information letter, ALEs need to remain diligent in preparing for their ACA IRS reporting requirements for the 2017 tax year, with filings and forms due the first quarter of 2018.

Clients may request to have HKP prepare their ACA IRS filings for them, as HKP offers a full-service 1095/1094 e-file production and mailing service. Full-service HKP payroll clients have the 1095c reporting capability built into their human capital management platform.

For further counsel on ACA IRS reporting responsibilities, call 888-556-0123, email hrconsulting@hkpayroll.com  or submit our online form.

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