For many employers, the 2015 tax season included new health care documentation under the Affordable Care Act with regard to employees. Forms such as 1094-C and 1095-C apply directly to those employers with 50 or more full-time employees and/or equivalents. These documents are used to report acknowledgment of health care offering to employees, and their deadlines have since been extended.
For paper filing, the deadline is now May 31, 2016; for electronic filing, June 30, 2016. However, if your initial reaction is to electronically file for ease, think again. Electronic filing of documentation is more difficult than you may think.
First, it’s best to understand the filing system.
The IRS has devised AIR: The Affordable Care Act Information Returns system. This system, much like FIRE (Filing Information Returns Electronically) requires an application for a Transmitter Control Code (TCC) before anything else can be accomplished. Within the application, are names required for code delivery. Responsible Officials, are at least two names listed that can sign the TCC application. Contacts, are at least two names listed that can interact with the IRS as well as transmit information.
Once these names have been identified, an employer must test to see if their technology is compatible with the AIR system for electronic filing. This is accomplished through an ACA Assurance Testing System, in order to ensure the electronic filing process will be without error. While hiring a third party vendor may simplify this process for you, the IRS has run into technological margins of error with vendors as well.
Does all of this sound too complicated? If it does, and your company has less than 250 returns, simply file your forms physically instead of electronically. However, that date is quickly approaching, and penalties for late filing are $250 per return. For more information, visit www.irs.gov/AIR.