When it comes to ACA compliance, many employers focus solely on meeting filing deadlines and ensuring that Forms 1094-C and 1095-C are submitted on time. However, compliance begins long before these forms are filed. The accuracy of the data feeding into your ACA filings is just as important as the filings themselves.
Inaccurate or incomplete data from payroll and benefits systems can result in costly IRS penalties. Unfortunately, many compliance solutions lack the tools needed to reconcile and validate this data effectively.
Learn why data accuracy is critical for ACA compliance and how Trusaic’s solution ensures clean, accurate data flows seamlessly into your filings, eliminating the risk of errors and penalties.
The Hidden Challenges of Data Accuracy in ACA Compliance
ACA compliance is inherently complex, requiring employers to track and manage vast amounts of data from multiple sources, including payroll and benefits systems. Without proper validation and reconciliation, this complexity can lead to significant risks:
- Incomplete or Inconsistent Data: Data discrepancies between payroll and benefits systems can result in incomplete or inconsistent ACA filings, triggering IRS penalties. A common example of this is a payroll system defaulting to assigning a full-time employment designation to new employees. If this isn’t corrected, the employee will appear to require an offer of health coverage. If the employee wasn’t offered, this results in a costly 4980H penalty risk.
- Manual Reconciliation Errors: Many employers rely on manual processes to reconcile data, which is both time-consuming and prone to human error. These errors can lead to inaccuracies in affordability calculations, employee classifications, and reported coverage details.
- Audit Vulnerabilities: During an IRS audit, discrepancies in ACA filings can lead to penalties, even if those errors were unintentional. Employers need to ensure that their data is accurate and audit-ready at all times.
- Operational Inefficiencies: The lack of automated tools for data validation and reconciliation increases administrative burdens, diverting valuable time and resources from other priorities.
These challenges highlight why data accuracy is the foundation of successful ACA compliance.
Why Most ACA Solutions Fall Short
Many ACA compliance solutions are built to handle specific tasks, such as generating ACA forms or tracking employee hours. While these features are important, they don’t address the root cause of compliance issues: inaccurate or incomplete data.
Most solutions fail to provide comprehensive tools for data validation and reconciliation, leaving employers to bridge the gaps manually. This fragmented approach creates several shortcomings:
- Limited Data Validation: Basic solutions often lack the ability to cross-check data across payroll and benefits systems, increasing the risk of inaccuracies.
- No Automated Reconciliation: Without automation, reconciling data from multiple sources becomes a manual, error-prone process that drains time and resources.
- Reactive Compliance: Many systems focus on end-of-year filing rather than year-round data accuracy, leaving employers vulnerable to penalties
Something as simple as forgetting to include the line 15 amount on Form 1095-C (when required) could result in a rejection of the IRS filing. If this goes undetected and unresolved by your provider, you could be subject to non-filing penalties. This underscores why you need a solution that prioritizes data accuracy and ensures audit-proof compliance from the start.
How Trusaic’s Solution Ensures Data Accuracy
At Trusaic, we understand that ACA compliance isn’t just about filing forms; it’s about ensuring that the data behind those forms is accurate, complete, and audit-ready. Our solution is designed to address the hidden complexities of data management, providing tools that automate data ingestion, validation, and reconciliation. Here’s how we ensure data accuracy:
- Comprehensive Data Validation: Our platform validates data from multiple sources, including payroll and benefits systems, to ensure consistency and accuracy. Advanced algorithms cross-check employee records, hours worked, and coverage details, catching errors before they impact filings.
- Automated Data Reconciliation: Manual reconciliation is a thing of the past with Trusaic’s automated tools. Our platform aligns data from payroll and benefits systems, ensuring that discrepancies are resolved quickly and accurately. This saves employers from the time-consuming and error-prone task of manual reconciliation.
- Seamless Data Integration: By integrating with payroll and benefits systems, our solution ensures that data flows seamlessly and accurately into ACA filings. This eliminates the risk of data silos and ensures a single source of truth for compliance purposes.
- Audit-Ready Records: Our solution provides year-round tracking and monitoring, ensuring that your data is always audit-ready. With clean, accurate data, employers can respond confidently to IRS inquiries and avoid penalties during audits.
- Proactive Risk Management: In addition to ensuring data accuracy, our platform includes a penalty risk assessment tool that identifies potential compliance issues before they become problems. This proactive approach allows employers to address risks early and avoid penalties.
Don’t Let Data Inaccuracies Put Your Compliance at Risk
ACA compliance is more than just filing forms; it’s about ensuring that the data behind those filings is accurate and complete. Inaccurate or incomplete data can lead to penalties, audit vulnerabilities, and operational inefficiencies that cost employers time and money. That’s why data accuracy should be a top priority for any organization seeking to maintain compliance.
Trusaic’s ACA Complete® solution is designed to eliminate the risks associated with inaccurate data. By automating data ingestion, validation, and reconciliation, our platform ensures that your compliance processes are seamless, efficient, and audit-proof. Don’t let data inaccuracies jeopardize your compliance efforts.
Ready to ensure ACA compliance with accurate data? Schedule a demo today and see how our platform safeguards your compliance while saving you time and resources.
Superior software, superior service — it’s what we do.