ACA reporting season for the 2024 tax year is upon us. And while furnishing and filing deadlines remain mostly static from year to year, that doesn’t make compliance any easier.
Additionally, this year employers have choice in how they furnish 1095-C forms to employees due to recently passed legislation. In this blog we’ll outline all of federal and state deadlines, focusing on the most pressing ones, and the penalties associated with them
Overview of Filing and Furnishing Deadlines
Applicable Large Employers (ALEs) have various federal and state furnishing and filing deadlines for the 2024 tax year to be aware of. Below is an overview of those deadlines:
- March 3: Federal deadline for furnishing 1095-C forms to employees. Also the deadline in New Jersey, Rhode Island, and Washington D.C.
- March 31: Federal deadline to e-file Forms 1094-C and 1095-C. Also the e-file deadline in California, New Jersey, Massachusetts, and Rhode Island.
- April 30: Deadline for ACA filing in Washington D.C.
- May 31: Extended deadline for ACA filing in California.
California and Massachusetts’ furnishing deadlines were Jan. 31. There is no penalty associated with the furnishing requirements as of now. However, employers that fail to meet the March 3 federal deadline will face penalties.
Failure to Furnish and File Penalties
There are various penalties associated at the state and federal level for failure to file and furnish. The federal penalties are as follows:
- Failure to File Penalty – IRC 6721: Failure to file correct information returns. If the return is not filed by the late filing Aug. 1 deadline, the full penalty is assessed per applicable individual returns not filed.
- Failure to Furnish Penalty – IRC 6722: Failure to furnish correct payee statements. If the ACA-mandated health insurance information is not provided to applicable employees by the deadlines established by the IRS, the penalties are assessed per applicable individual not receiving this information.
The state filing and furnishing penalties are as follows:
- California: Employers who fail to meet the California ACA reporting requirements may be fined $50 per individual not reported on. There is no penalty for non-furnishing by the Jan. 31 deadline.
- Washington D.C.: There are no penalties for non-compliance.
- Massachusetts: Massachusetts levies fines of $50 per individual for employers that do not fulfill ACA state filing requirements. The maximum penalty is $50,000.
- New Jersey: New Jersey has not yet stated what penalties it may impose on non-compliant employers. But it’s important for organizations to adhere to New Jersey ACA reporting requirements in order to avoid any surprise fines. We’ll update you with more information as soon as it’s available.
- Rhode Island: Rhode Island has not provided any details as to whether it will impose fines for non-compliance
In addition to these deadlines, there are new 1095-C furnishing rules to keep in mind.
New 1095-C Print and Mail Rules
Under the Employer Reporting and Improvement Act and the Paperwork Burden Reduction Act Applicable Large Employers (ALEs) have a new option to meet their furnishing obligations that no longer requires them to automatically furnish Form 1095-C to full-time employees. Instead, employers can opt to provide these forms only upon employee request, provided they meet certain conditions:
- Employee Notification: Employers must provide clear, conspicuous, and accessible notice to employees, informing them of their right to request Form 1095-C. The IRS may provide specific guidelines on the timing and manner of this notification.
- Timely Furnishing Upon Request: Upon receiving a request, employers must furnish the employees Form 1095-C by the later of:
- Jan. 31 of the year following the calendar year in which coverage was provided, or
- 30 days after the date of the request, whichever is later.
It is important to note that ALEs still have the option to furnish through mail distribution and/or get employee opt in to receive electronic distribution. In addition to the new furnishing option, the legislation extends the deadline from 30 to 90 days for ALEs to respond to IRS Letter 226J. This is a letter informing employers of a proposed assessment of the employer shared responsibility payment (ESRP) before the IRS takes further action.
Simplify ACA Reporting with Trusaic
Trusaic’s ACA compliance service enables you to offload 1095-C furnishing and filing responsibilities. We deliver everything you need to track, prepare, furnish and file 1095-C forms. We provide monthly monitoring so you receive alerts for when offers of coverage are required and our penalty risk assessment tool identifies coverage gaps and enables you to address liabilities quickly.
For form furnishing, our designated support team prepares and distributes your 1095-C forms on-time to applicable employees by U.S. mail or electronically on demand.
Given the new legislation, we offer our clients two options to choose from:
- e-Distribution + Print and Mail (CA, RI, NJ only)
- Print and Mail only
Option 1 is our recommended approach and organizations can e-distribute with ease utilizing Trusaic’s platform. Our e-distribution platform makes it easy for an employer to notify their employees of the option to receive their forms while providing them with a link where they can access the form electronically.
This also simplifies any employee follow-up requests for a form as the employer can simply resend the link to their employee giving them digital access to their forms. This ensures all your forms are distributed on-time and can be easily tracked for compliance purposes.
Book a meeting to learn how Trusaic is guiding our clients this ACA reporting season.
