Under Patient Protection and Affordable Care Act, employers that qualify as Applicable Large Employers have to provide the details of the full-time employees covered under health coverage in 1094 and 1095 forms under section code 6055 and 6056, or they will be subjected to the penalty. To be sure of its decree, employees have to comply with the monthly ACA Reporting. Implemented in 2010 under Barack Obama’s presidency, this act ensures that a reliable national health insurance service covers individuals, their spouses, and the dependants.
At the end of every financial year, employers are to report form 10954s and 1095s to the IRS and every year, owing to the complexity and gravity of the ACA, dozens of employers make one or the other mistake in filing the form.
Following are the common ACA Reporting mistakes:
The Social Security Number of the covered individual is invalid:
The number assigned under 205(2)(C) under the social security act to the permanent resident and temporary working residents of United States is SSN. This is the most common error especially when filling out the dependant covered by health insurance since they aren’t assigned any SSN yet. To rectify it, fill the SSN details with the birth date.
Improper reporting on line 14 and line 16 in the 1095 form:
The line 14 of 1095 is used to report whether the employee was covered under the health insurance for every month of the year. By using the appropriate code, the employer has to mention the kind of coverage offer made to the employee for the specific month and not the one they elected.
The line 16 is to report the details of the employees offered minimum value coverage by the employers, who can not benefit from the health insurance premium subsidy.
Qualifying ALE is permitted to determine the full-time status either through stability measurement method or monthly measurement method. The 1095 C must reflect the measurement approach and for that employers have tenure that the coverage hours are measured per the IRS method.
Taxpayer Identification number failure:
When the social security name does not match the actual name, in the event of a marriage or a divorce, this issue occurs. It can be resolved by correcting and updating the names with the US Social Security force. This error needs no correction in the forms, but the employer must conduct due diligence. Mentioning accurate details in every line is essential for a valid reporting.
Other common errors are the incomplete filling of the forms, not safeguarding employee data or unable to file it by the due date. Make sure you avoid these error when reporting to the IRS for the year 2018. If you are having trouble understanding rules or are facing any complication regarding filling up the forms and need help to go about it, you can get in touch with a tax form filing firm that can assist you with the ACA proceedings with their updated technology and excellent support for ACA reporting services.