Employers looking toward the new year will need to keep the 2023 ACA reporting deadlines in mind to avoid steep penalties from the IRS.
Every year, Applicable Large Employers (ALEs) must file and furnish their ACA information to the IRS as required by the ACA’s Employer Mandate.
Under the ACA’s Employer Mandate, ALEs, or employers with 50 or more full-time and full-time equivalent employees must:
- Offer Minimum Essential Coverage to at least 95% of their full-time employees (and their dependents) whereby such coverage meets Minimum Value
- Ensure that the coverage for the full-time employee is affordable based on one of the IRS-approved methods for calculating affordability
As you prepare your ACA filings for the upcoming 2023 reporting season, be sure to remember these critical ACA reporting deadlines to minimize the risk of receiving IRS penalties.
2023 ACA paper filing deadline
ALEs that choose to paper file the annual ACA 1095-C information for the 2022 tax year must do so by February 28, 2023. This option is only available for employers with 250 1095-C forms or fewer.
Employers that paper file should be aware of new IRS proposed regulations that cut down the size eligibility for paper filing. By the 2023 tax year, employers will only be able to paper file their ACA information if they have 10 or fewer 1095-C forms.
2023 ACA furnishing deadline
ALEs must furnish the 1095-C form to each of their full-time employees for the 2022 tax year by no later than March 2, 2023, previously January 31, 2023.
2023 ACA electronic filing deadline
For ALEs that choose to file electronically, the 2023 ACA filing deadline is March 31, 2023. In addition to a later ACA deadline for 2023, there are other benefits for filing electronically. These benefits include instant IRS acknowledgment of submission and an immediate response about whether the submission was accepted or rejected.
PCORI fees deadline
The Patient-Centered Outcomes Research Institute fees for 2022 health plans are due July 31, 2023. It’s important to note that these fees have increased, according to Notice 2022-59, issued by the IRS on November 14th.
For plan years that end on or after October 1, 2022, and before October 1, 2023, the fee has been raised from $2.79 to $3.00 per person. For plan years that ended on or after October 1, 2021, and before October 1, 2022, the fee is $2.79 per person.
Last year the IRS issued proposed regulations to make an automatic 30-day extension for furnishing permanent. Though no news has been given regarding whether those regulations were signed into the legislature, the draft 2022 1095-C form instructions include language that confirms the 2022 deadline for furnishing, to be completed in 2023, has indeed been extended from January 31 to March 2.
Steep penalties for non-compliance
Employers that miss the deadlines mentioned above can be subject to IRS penalties under IRC 6721/6722. The tax agency is currently issuing these late and non-filing penalties via Letter 972CG and Letter 5005-A.
In addition to late and failure to file penalties, the IRS is also issuing 2020 non-compliance penalties via Letter 226J, so employers must submit 100% compliant ACA filings to avoid IRS penalties in the future. The penalty amounts can range into millions of dollars — we know because we’ve helped new clients eliminate them.
Contact us to learn about our full-service ACA compliance solution, ACA Complete. We’ve helped thousands of clients, large and small, meet the ACA deadlines while reducing their penalty risk simultaneously.
For more information on 2022 ACA deadlines to be completed in 2023, download the ACA 101 Toolkit below.
Missing an ACA filing or furnishing deadline could land your organization a significant penalty from the IRS. To ensure you never miss one, download the ACA 101 Toolkit, which documents the various federal and state reporting deadlines.