The Big FIX. Managing 2016 ACA Corrections 5/1/2017. PSST Senior Client Success Advisor. presented by Dianna Palmer Gainey, Ed.D.

Transcription

1 CLICK HERE for video version of this webinar. 1 The Big FIX Managing 2016 ACA Corrections for IRS presented by Dianna Palmer Gainey, Ed.D., PHR PSST Senior Client Success Advisor CLICK HERE for video version of this webinar. 1

2 Note: This webinar is specific to the clients of PSST, LLC who are currently utilizing ACA Tracking and ACA Reporting products. If you are not a client with PSST, LLC, and would like more information on our ACA Tracking or Reporting products, please contact Matt Simons or Bill Fowle at Objectives for today Participants will understand IRS regulations as they apply to ACA reporting corrections Participants will learn how to correct errors in the ACA Wizard Participants will learn strategies for adequate preparation for IRS inquiries or audits for ACA 2

3 Why submit ACA corrections to the IRS? Internal Revenue Code (IRC) section 6721 ACA still the law of the land Employers must comply with the law or face consequences There is no way to forecast when/how ACA will change Executive Order signed by Trump can ease some of the regulations The Treasury and IRS may find administrative ways to simplify the current complex employer reporting rules. 3

4 Penalties for non compliance Failure to file correct information returns may result in a penalty of $250 per return for each of the following infractions related to information returns: Filed with a missing/incorrect TIN (or other incorrect information) Filed untimely Filed on paper when filing electronically was required Filed in an incorrect format, or Any combination of the above Penalties may be waived if the reporting failure is due to a reasonable cause. Filers must establish that they acted in a responsible manner both before and after the failure occurred and that 4

5 Reasonable Cause (cont.) There were significant mitigating factors (e.g., an established history of filing information returns with correct TINs), or The failure was due to events beyond the filer s control (e.g., the unavailability of relevant business records as a result of a fire or other casualty that prevented timely processing and filing of the required forms) Due Diligence Except as otherwise stated in this publication (IRC 6721), acting in a responsible manner generally includes making an initial solicitation (request) for the payee s name and TIN and, if required, an annual solicitation. 5

6 IRS Errors Deciphering If any data element in Form 1095C 'MonthlyOfferCoverageGrp' (JanOfferCd through DecOfferCd) has a value of "1B", or "1C", or "1D" or "1E", or "1J", or "1K", then the corresponding data element in 'MonthlyShareOfLowestCostMonthlyPremGrp' (JanuaryAmt through DecemberAmt) or 'AnnlShrLowestCostMthlyPremAmt' must have a value greater than or equal to zero If Form 1095C 'CoveredIndividualName' in 'CoveredIndividualGrp' has a value, then the corresponding 'SSN' or 'BirthDt' in 'CoveredIndividualGrp' must have a value Most common types (deciphered) of 1095 errors The name and SSN must match the IRS database If Line 14 has a value of "1B", or "1C", or "1D" or "1E", or "1J", or "1K", then Line 15 must have a value Covered individuals in Part III of the 1095 must have either a SSN or birth date 6

7 Most common types of 1094 errors (continued) Business Name and EIN within does not match the IRS database Certificate of Eligibility incorrect Which IRS error(s) require correction? IRS instructions provide examples of the types of errors that require correction (essentially all errors on forms 1095 C and 1094 C), including the following: 7

8 Form 1095 C Employee/enrollee name, employee/enrollee Social Security number (SSN) Employer identification number Details on the offer of coverage Premium amount for self only coverage for the lowest cost option Affordability safe harbor and other relief codes (e.g., multiemployer plan relief) Information about covered individuals (e.g., name, SSN, months of coverage) Errors that do not need to be corrected Errors that really aren t errors (i.e., employee name and SSN match after diligent research) Errors that after due diligence cannot be corrected because the information is not available (i.e., employee did not respond to solicitation for information) 8

9 Procedure for correcting errors For returns filed electronically (required if filing 250 or more forms), ALEs should correct errors as follows: To correct an error on Form 1094 C, check the Corrected box, refile the form with the IRS and do not include any Forms 1095 C. To correct an error on Form 1095 C, file the corrected Form(s) 1095 C with an associated Form 1094 C (do not check the Corrected box on Form 1094 C, and complete only Part I). Correcting both a Form 1094 C and Form 1095 C requires two separate submissions, which can be included with the same transmittal to the IRS. Form 1095 C corrected box 9

10 Form 1094 C corrected box Fixing Errors in ACA Wizard CLICK HERE for video version of this webinar. 10

11 Log in to ACA track.biz address Next, click on Reporting Wizard 11

12 Next, select Reporting Year Next click Select 12

13 Click on Corrections in the ALE Dashboard You are now at the IRS Corrections module 13

14 Errors will appear in a table. To the right of each error, there is an Edit button. Click this button to make the correction(s). Make the corrections directly in the fields on the screen and when finished, click on Save Changes 14

15 Correcting Covered Individuals Correcting Covered Individuals 15

16 After you click Save Changes, you will be returned to the IRS Corrections page where you will see an author, date and time entry for the edit under the Edited On column. The Submit 1094 Corrections and Submit 1095 Corrections buttons will remain washed out until edits are made 16

17 There are 5 buttons at the top of the IRS Corrections module All corrections for employee records should be done in the IRS Corrections module with 2 (two) exceptions: Adding an employee Deleting an employee 17

18 To add an employee during the Correction process you will use the Reporting Set Editor. Access by going to the Reporting Set and click on Review In the Reporting Set Editor, click Add Employee then fill in all the necessary fields. 18

19 To delete an employee during the Correction process go to the Reporting Set Editor and filter for the employee then click on Edit, and in the Employee Details tab, mark the Do Not Report box, then Save Changes If you are adding or deleting an employee, that correction will necessitate a corrected 1094 Line 18 the total number of forms 1095 C 19

20 If you are adding or deleting an employee, that correction will necessitate a corrected 1094 Line 18 the total number of forms 1095 C If you are adding or deleting an employee, that correction will necessitate a corrected 1094 Line 18 the total number of forms 1095 C 20

21 Continue correcting until all corrections have been made then click Submit 1095 Corrections : After submitting, check back on overall status to find out results 21

22 Additional ACA Wizard Resources: There are 3 tabs at the bottom of the IRS Corrections screen: Additional ACA Wizard Resources: There are 3 tabs at the bottom of the IRS Corrections screen: Current Errors lists the current errors as returned by the IRS History shows the most recent submission to the IRS Employee View lists all employees and their submission status/date to IRS Submission View lists each submission to IRS/date and the status of each 22

23 Current Errors tab History tab 23

24 Employee View tab Submission View tab 24

25 After initial filing, how long are corrections still necessary? ALE s should correct the error as soon as possible. ALE s should correct Forms 1094 C and 1095 C for any open tax years (within three years of the filing due date). The ALE should discuss any outstanding issues with their legal counsel. Due diligence and Good Faith efforts (documentation for IRS inquiries/audits) CLICK HERE for video version of this webinar. 25

26 Strategies for documenting efforts for SSN and name mismatches Request SSN card from employee or dependent to ensure name and SSN match Check IRS website for employers ( free service to check SSN against name If the IRS error is an error (if the name and SSN are correct), retain a copy of the SSN card for documentation no correction is necessary to 1095 Strategies for documenting efforts for SSN and name mismatches (cont) Send reasonable correspondence to individuals to obtain proof of name and SSN with return receipt request or USPS certified mail Retain copies of correspondence in a 2016 ACA Reporting file for documentation 26

27 What questions do you have? PSST Forward Thinking initiatives E portal for employees to access their own 1095 C s and W 2 s, eliminating the need for printing/sending 1095 s ACA Wizard enhancements Fraud monitoring/detection program Continued Webinars for client support throughout the year 27

28 For additional information contact your Client Success Advisor or CLICK HERE for video version of this webinar. Information provided by PSST, LLC concerning the Affordable Care Act is not legal advice and should not be treated as such. If you have questions about how the Affordable Care Act will affect you as an employer, please consult legal counsel. 28

29 Thank you for attending today s webinar! CLICK HERE for video version of this webinar. 29