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Supporting you through the 2020 ACA reporting season

We know that workplace challenges often create the greatest stress on HR teams who are working diligently to keep their workforce healthy and safe. That's why we are committed to sharing what we know around regulatory changes and their bearing on health reform, insurance eligibility, payroll and more during this reporting season. 

To keep you in the know, here's our Ask the Expert question of the week: 

Q. I submitted my Forms 1094 and 1095 and received an IRS notice that they were accepted with errors, now what do I do?

A. Don’t Panic! It is important to understand that after submitting your files for reporting season it is very common for the IRS to identify form errors. Luckily, you have time to make corrections. Making sure to correct these errors can save your company from penalties that could accumulate into millions of dollars.

Your files were accepted with errors
In most situations when you have submitted your forms and receive a letter from the IRS with a notice of an error, they will accept your files and give you time to make corrections. Here’s some common reasons why you may receive a correction notice, and tips for addressing them.

Tips for reducing errors for Form 1094
Form 1094 can be confusing, and here are a few tips for reducing errors.

  • Complete all the required lines. Missing one check box is enough to trigger an error on any 1094-C form.
  • Correctly check Minimal Essential Coverage indicator. Failing to check “Yes” or “No” to confirm whether an offer of Minimum Essential Coverage (MEC) was made to 95 percent of your full-time employees (Part III, Column A) could trigger an error. All appropriate months must be checked.
  • Check the ALE Member box. Make sure to check the Section 4980H Full-Time Employee Count for ALE Member box
  • Use the correct FEIN and legal name. Mismatched federal employer Identification numbers (FEIN) versus legal names happen more than you think and will trigger an error notice.

Tips for reducing errors for Form 1095
Form 1095 is all about making sure you have offered affordable coverage to the right people. Here are a few tips to reduce your chance of triggering an error.

Additional tips to help reduce your chances of receiving a Letter 226-J

  • Assure you have reflected an offer of coverage. Employers should review each form to make sure the correct offer of coverage code is populated each month for every employee on Line 14. Coverage must be available every day of the calendar month to be considered an offer of coverage.
  • Make sure to complete line 16 to indicate you offered affordable coverage that meets MEC. Leaving line 16 blank on Form 1095-C indicates that the ALE did not offer affordable coverage that met minimum value requirements (unless line 14 is coded as 1A).

Health e(fx) can help
We make corrections easier. If you work with Health e(fx) and have received a system alert indicating that your 2020 Affordable Care Act (ACA) Information Return submission contained any form errors forms that were rejected, our system can help you track the employees with mismatched information. This allows you to easily fix the error and resubmit a corrected form on a timely basis. Click here to find out how our solutions make ACA compliance, reporting and corrections easier.

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