Employer Shared Responsibility FAQs, Part 1

Welcome to the first of our two-part post on some of the questions surrounding the Affordable Care Act - more specifically, the Employer Shared Responsibility parts of it. If there’s something about employers’ responsibilities under the ACA you’ve been wondering about, we’re going to do our best to answer it!


Which employers are subject to the Employer Shared Responsibility provisions?
The employers subject to the Employer Shared Responsibility provisions are ALEs or Applicable Large Employers.

Which are employers not subject to the Employer Shared Responsibility provisions?
For the calendar year, any employers who do not employ at least 50 full-time employees and are therefore not ALEs are not subject to the Employer Shared Responsibility provisions.

How many employees does an employer have to have to be subject to the Employer Shared Responsibility provisions?
ALEs have an average of at least 50 full-time employees, including full-time equivalents, throughout the year.

Do the Employer Shared Responsibility provisions apply only to large employers that are for-profit businesses?
No, any type of employer can be considered an ALE and therefore be liable for the Employer Shared Responsibility provisions, including tax-exempt and non-profit organizations.

Do the Employer Shared Responsibility provisions apply to government entities?
Yes, as stated before, any employer can be an ALE, including all government entities.


Didn’t see your question here? Stay tuned for our next installment of the Employer Shared Responsibility FAQs! In the meantime, if you need to get started e-filing your ACA return, you can do so through ExpressIRSForms, or let us do it for you at ExpressACAForms!

Questions? Give us a call Monday through Friday, 9:00 a.m. to 6:00 p.m. EDT, at (704) 684-4751 or send us an email anytime at support@ExpressIRSForms.com!

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Could the Affordable Care Act be Repealed?

It’s no secret the Affordable Care Act, also known as Obamacare, wasn’t the most popular piece of legislation to pass. It’s also no secret that candidates across the board are preparing for either a complete or partial repeal of the ACA and are adding their best alternatives to their respective platforms.

In anticipation of what the election could mean for the ACA, the International Foundation of Employee Benefit Plans (IFEBP) in Brookfield, Wisconsin recently released a new survey report on the impact of the ACA. They found that 78% of employers would like to keep some of the mandated changes brought on by the ACA, even if it were to be repealed. However, new legislation would have to be written to maintain these changes. Employers mostly wanted to keep these provisions, as they noticed a positive impact on their employees’ physical, financial, and emotional well-beings as a result:

• The elimination of pre-existing condition exclusions
• Coverage of adult children through the age of 26
• Increased wellness incentives
• No cost-sharing for preventative care

The biggest compliance challenges for employers, however, were found to be reporting and disclosure issues, cost issues, and employee communications.

At the IFEBP’s recent Washington Legislative Update event, they announced three possible scenarios for the ACA as a result of the November election:

1. If the Republican nominee is elected and the Republicans keep control of Congress, the ACA will be repealed. A tax reform and regulatory rollback will accompany this. Democrats will have the option to filibuster to contest any of their changes, but the majority vote from a Republican Congress would pass any measure related to spending and revenue.
2. If the Democratic nominee is elected and the Democrats take control of Congress, the ACA will stay, but it’s probably necessary fixes will be passed through the budget reconciliation process.
3. If the Democratic nominee is elected but the Republicans keep control of Congress, the likely result is “more of the same gridlock” barring a related crisis, like health insurers abandoning public exchanges.
4. If a 3rd party nominee is elected, well, we're not sure what will happen because our source didn't explore that option.

But, regardless of the result of the November 2016 election, it’s still required to have your 2015 ACA return e-filed by the end of this month - by 11:59 p.m. on June 30, 2016. You can e-file your return quickly and easily with ExpressIRSForms! If you have any questions, feel free to give us a call Monday through Friday, 9:00 a.m. to 6:00 p.m. EDT, at (704) 684-4751. We’re also available 24/7 at support@ExpressIRSForms.com.


Looking for something a little less hands on? Visit www.ExpressACAForms.com for our full-service ACA e-filing solution.

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How to Convert Non-Hourly Compensation into ACA Service Hours

As an Applicable Large Employer (ALE), it’s your responsibility to make sure you make offers of health coverage and benefits to your full-time employees, which the IRS determines based on the amount of hours they work per week (30 or more, and they’re full-time).

But what about your employees whose compensation isn’t based on their actual hours but on their output of work? In the instance of commission-only sales persons, pieceworkers, adjunct faculty, or any other workers whose hours you don’t track, you’ll need to develop a method of converting the work they’ve done into an hours-of-service equivalent consistent with the ACA regulations under Section 4980H.

These regulations essentially boil down to your method must be “reasonable” in the eyes of the IRS; in other words, the method can’t be designed to limit the employee’s right to a health insurance offer. This means you’ll more than likely have to take into account hours other than the ones the employee produced work to figure out their status (i.e., travel time for your commission-only sales people).

There are also varying, industry-specific methods to determining the status of pieceworkers, or workers who are paid according to the number of units of work produced:

• In the fishing industry, workers are often compensated based on the weight of their catch, so their employee status can be determined by how long the fishing boat was out. If on average during the measurement period, the boats were out for 12 hours each day, each worker would be credited 12 hours each day he/she was out on the boat.

• Some of our ExpressTruckTax users may want to pay attention to this one: companies who pay their truckers based on their miles traveled can convert those miles into hours worked. A good conversion rate, based on speed limits and break times, is 50-miles-to-1-hour-of-service. So, for example, a trucker who traveled 400 miles in one day would earn 8 hours toward his/her full-time status.

• For agricultural workers, like apple pickers, paid based on what they gather each day can use the bins or baskets they gather as an hour conversion method. For example, you pay your workers $12 per bin of apples they collect daily, estimating that it takes about an hour to pick a full bin. If your records reflect you paid an employee $99 one day, you can divide that by the $12/bin to determine he/she worked roughly 8 ¼ hours.

• The IRS has outlined a way to determine the status of adjunct faculty members at higher-education institutions. For employees who are paid by the class, 2 ¼ hours of service should be included per week (to cover teaching and classroom time in addition to out-of-class work like lesson prep and grading) for each hour of classroom time. Additionally, 1 hour of service per week should be included in their total for each additional hour outside of the classroom they spend on their required duties, such as during office hours or faculty meetings.

If you’ve already got your employees work hours totaled and are ready to file your ACA forms, log into your ExpressIRSForms account today to get started! Or, check out our full-service filing option, ExpressACAForms. If you’re not sure which you’d like to try, just give us a call at (704)-684-4751 and we’ll be happy to help you get started.

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ACA Compliance: How to Track Variable Hour Employees

Variable hour employees are those who, based on circumstances surrounding their employment, cannot easily be classified as a standard, 30-hour-per-week full-time employee. In other words, their schedules fluctuate so greatly, it requires a longer measurement period to determine whether they’re eligible for health coverage and benefits extended to other full-time employees.

But just because they’re variable hour employees doesn’t mean they can be swept under the rug. If any of these employees does work, on average, over 30 hours per week and you don’t make an offer of coverage to them, you could face a $100 per day penalty for each affected employee.

Employers are given a full year, or “measurement period,” under the ACA to determine whether or not their variable hour employees average 30+ hours of work each week. If an employee is discovered to have exceeded 30 hours/week, you must make an appropriate offer of coverage. It must go into effect within 90 days of acceptance and be available for a full 12 months, even if the employee’s hours worked drop below 30 hours/week. This time period that the employee is covered is called the “stabilization period.”

Unlike your regular full-time employees, variable hour employees must qualify for their offers of coverage each year by working that average of 30 hours a week. That’s why it’s recommended employers set their measurement period to start 90 days before the annual renewal date. So the measurement period for companies with a January 1 renewal date will measure their employees’ variable hours from October 1 to September 30 of the year before. This also makes it easier for handing out your offers of coverage, since you’ll only have one open enrollment period.

Already have your employees tracked and ready to file? Great! You can start with ExpressIRSForms today! And if you have any questions, don’t hesitate to call our customer support center in Rock Hill, South Carolina. We’re available Monday through Friday, 9:00 a.m. to 6:00 p.m. EDT, at (704) 684-4751 and 24/7 at support@ExpressIRSForms.com.



Looking for something a little less hands on? Check out ExpressACAForms, our full-service ACA e-filing solution.

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Affordable Care Act Compliance Penalties

If an ALE (Applicable Large Employer), or anyone else who has to file information returns under the Affordable Care Act (ACA), fails to comply with this new ACA reporting requirement, they may be subject to IRS penalties and fines. And remember: penalties apply to both the forms that were supposed to be sent to the IRS but weren’t and forms that were supposed to be sent to your employees/recipients but weren’t.

Your potential penalty is determined by when your forms are received by the IRS (or your recipients) without any errors. If you send your completed return

• within 30 days of the deadline, you’ll be charged up to $50 per form.
• after 30 days after the deadline but before August 1, you’ll be charged up to $100 per form.
• after August 1 or not at all, you’ll be charged up to $250 per form.

There are regulations in place to cap the total amount you can be charged each year (the largest limit being $3,000,000), however, the IRS does reserve the right to increase these charges if they find evidence of willful intent not to file.

The IRS is offering exemption from these filing penalties for the 2015 filing year, which is completed this year (in 2016) if you can prove you made every effort to file your return correctly and on time.

You can avoid these penalties by filing on time and correctly, which is where ExpressIRSForms comes in. While we can’t make you file on time, it is our policy to remind you of any upcoming deadlines, and all of the bonus features we pack into our program will help make sure your return is error-free. So give it a try today!

For help getting started e-filing your ACA forms, or if you have any questions, don’t hesitate to reach out to our customer support team. We’re available by phone (704-684-4751) and live chat Monday through Friday, 9:00 a.m. to 6:00 p.m. EDT, and by email (support@ExpressIRSForms.com) 24/7.



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Full-Time Employee Calculator for ALEs

We can’t stress how important it is to get the total amount of full-time employees (FTE) and full-time equivalent employees exactly right for your ACA compliance and reporting. The IRS, among answering many questions about who qualifies as an FTE, has provided a way to determine the amount of FTEs you have:

1. First, add up the total hours of service you paid wages to employees during the year (this shouldn’t exceed more than 2,080 per employee).
2. Next, divide that total by 2,080.
3. If your result is not a whole number, round to the next lowest whole number.
4. Unless the result is less than one, then round up to one FTE.

Calculating your employees’ hours worked this way helps with circumstances where an employer may qualify for the employer shared credit even if they have fewer than 50 actual full-time employees on the payroll.

For instance, if you have 48 individuals employed part-time, they could equal out to be 24 full-time employees, qualifying you for some credits.

ExpressIRSForms includes a full-time employee calculator within the program, as do ExpressACAForms and ACAwise. We’ve included as part of our continuing promise to bring you the easiest, most convenient solution in e-filing services. Use the FTE calculator to double check your own math, or let it do the work for you!

If you need help e-filing your ACA forms, give us a call Monday-Friday, 9:00 a.m. to 6:00 p.m. EDT, at (704) 684-4751, or send us an email anytime at support@ExpressIRSForms.com.

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How to Report COBRA on ACA Forms

When you’re working on your ACA Forms 1094 and 1095, you might run into a situation where you’ll need to report COBRA coverage information for your employee and/or their spouse and dependent(s). COBRA stands for the Consolidated Omnibus Budget Reconciliation Act, the federal law that provides workers with the right to continued coverage in a group health plan.

How you report this COBRA coverage will depend on whether your employee enrolls in the coverage and whether the employee was offered coverage because of termination or a reduction in hours. If the employee doesn’t enroll in COBRA coverage, that’s easy enough: you’ll report no offer of coverage beginning with the month the employment was terminated throughout the remainder of the year on Form 1095-C, Part II. In order to avoid penalties for those months, you’ll code the former employee as not a full-time employee (Code 2B).

Now, if your former employee does enroll in COBRA coverage, you’re going to have to indicate that you made an offer of coverage for all the months the employee was covered, those under the original group plan and the ones the employee enrolled in COBRA. Use the same code indicator for all of these months. Your cost of coverage should change in this section from the lowest cost employee-only premium to the COBRA single premium.

If the individual is still employed and they’ve accepted your offer of COBRA coverage as a result of a reduction in hours, you’ll still report that an offer of coverage was made for all the months under the original group plan and COBRA. Even if the ongoing employee didn’t enroll in the COBRA coverage, you’ll need to report your offer. Your indicator codes - which will be different for the months the employee’s hours were reduced - will alert the IRS as to why the COBRA single premium is listed for the months COBRA was offered.

You can e-file your 1095-C Forms (COBRA offers and all!) with ExpressIRSForms. Just log into your account and select the ACA Forms option to get started. If you have any questions, you can give us a call Monday through Friday, 9:00 a.m. to 6:00 p.m. EDT, at (704) 684-4751; or send us an email anytime at support@ExpressIRSForms.com.



Looking for something a little less hands on? Check out ExpressACAForms, our full-service ACA e-filing solution.

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