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New ACA Requirements Creeping Up in October

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As Oct. 1 quickly approaches, you may be feeling haunted by health care reform and the upcoming exchange notification requirements facing ALL employers subject to the Fair Labor Standards Act. Even if you already offer adequate and affordable health coverage to your employees, you too are required to issue exchange notifications to educate your workforce on the new health care marketplace.

Companies that provide health benefits may be especially curious as to why this requirement is rattling their business. The answer is that although the employer mandates to provide health insurance have been delayed to 2015, the individual mandate requiring individuals to buy health insurance has not. To help these individuals find coverage that meets their needs and fits their budget, employers are to direct them to a health care exchange/marketplace set to open Oct. 1, 2013. To help individuals enroll in coverage for 2014, the marketplace is designed with one-stop shopping for comparing private health insurance options. It is estimated that next year 7 million uninsured Americans will receive federally subsidized health coverage through the marketplace.

Employers Must Carefully Craft Their Marketplace Messaging
The Affordable Care Act has made it your responsibility to provide your employees with a marketplace notification regardless of their plan enrollment status or part-time or full-time status. Current employees must be notified no later than Oct. 1, 2013, and new hires must be notified at the time of hiring or within 14 days of their start date. The notice is to be provided automatically and free of charge.

The Department of Labor (DOL) is providing model notices on its website to help employers with the exchange notification process (http://www.dol.gov/ebsa/healthreform/). There is a model notice for employers who offer health insurance and a different one for those who do not, as well as Spanish versions of both.

Employers may use one of these models or a modified version as long as the content requirements are met. Content requirements include:

  1. Informing the employee of the existence of the marketplace, a description of the services provided, and the manner in which the employee may contact the marketplace to request assistance;
  2. If the employer plan’s share of the total allowed costs of benefits provided is less than 60 percent of such costs, the employee may be eligible for a premium tax credit under section 36B of the Internal Revenue Code if the employee purchases a qualified health plan through the marketplace; and
  3. If the employee purchases a qualified health plan through the marketplace, he or she may lose the employer contribution (if any) to any benefit plan offered by the employer and that all or a portion of such contribution may be excludable from income for Federal income tax purposes.

The notice must be provided in writing in a manner that can be understood by the average employee. It may be provided by first-class mail or electronically if it meets certain DOL standards.

Paycom Offers Tricks and Treats for Compliance
Paycom cautions employers implementing processes for notifying employees of health care exchanges not to forget the importance of the tracking and reporting tools needed to prove that all employees have been notified in compliance with the requirements.

There’s no need to be frightened! With its On-Boarding and Document Management functionality, Paycom helps employers automate their compliance processes. It’s an easy trick to upload exchange notifications for employees to electronically access and acknowledge receipt of the document.

The real treat is your ability to track and report on those who have and have not confirmed the receipt of their exchange notice. Once employees have electronically acknowledged receipt of the notification, it will be stored in their online documents where they can refer to it at any time through their Self-Service portal.

It’s no hocus-pocus — just single-application technology designed to simplify your human capital management. Contact Paycom today to see a demonstration.

The content of this blog is intended to keep interested parties informed of legal and industry developments for educational purposes only.  It is not intended as legal opinion or tax advice and should not be regarded as a substitute for legal or tax advice.



Author Bio: Newman Wells is a writer, designer and entrepreneur with over 20 years of corporate marketing experience. Passionate about B2B marketing, Newman Wells specializes in helping businesses define their value propositions by simplifying technical jargon for easier-to-digest messages that drive sales. She has spent the last two decades building successful marketing departments from the ground up and has been Paycom's director of marketing since 2005.

ACA ‘Cadillac Tax’ Delayed to 2022

ACA ‘Cadillac Tax’ Delayed to 2022

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The short-term spending bill that ended the government shutdown on Jan. 22 included a small provision that again delayed the Affordable Care Act’s (ACA) “Cadillac tax,” now to 2022.

So nicknamed because it targets employer-sponsored health plans with the most generous level of benefits, the Cadillac tax originally was to take effect in 2018. In 2015, the effective date was pushed to 2020, and now the new bill pushes the effective date two additional years into the future.

When – or if – the Cadillac tax goes into effect, it will impose a 40% excise on the cost of employer-sponsored health coverage exceeding a certain dollar value per employee. The dollar value would have been $10,200 for individual coverage and $27,500 for family coverage in 2018, had the tax not been delayed. The law calls for the amount to be adjusted annually with growth in the consumer price index.

How does this affect Employers?

Employers do not have to contend with the tax for an additional two years. The IRS has not yet issued regulations addressing implementation; with this additional delay, the agency likely will not do so in the near future.

Disclaimer: This blog includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer licensed in your jurisdiction for advice on specific legal problems.

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Posted in ACA, Blog, Compliance, Featured

Erin Maxwell

by Erin Maxwell


Author Bio: As a compliance attorney for Paycom, Erin Maxwell monitors legal and regulatory changes at the state and federal level, focusing on health and employee benefits laws, to ensure the Paycom system is updated accordingly. She previously served as assistant general counsel at Asset Servicing Group in Oklahoma City. She holds a bachelor’s degree from the University of Central Oklahoma and a J.D. from the University of Oklahoma. Outside of work, Maxwell enjoys politics, historical mysteries and spending time with her family.

Deadline Extended

Employer Deadline Extended for Furnishing 2017 ACA Forms

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Distribution of 2017 Affordable Care Act (ACA) Forms 1095-B or -C to your employees has been extended.

As issued in Notice 2018-06, the IRS has extended the deadline from Jan. 31 to March 2. (However, the deadline to provide Forms W-2 and 1099 to employees and contract workers remains as Jan. 31.)

Filing deadlines unchanged

While the deadline to furnish forms was extended, the filing deadlines remain the same: Feb. 28 for paper forms, and April 2 for electronic forms.

IRS Notice 2018-06 emphasizes that employers who do not comply with the due dates for furnishing or filing are subject to penalties under sections 6722 or 6721.

Good-faith transition relief extended

The IRS also announced the extension of good-faith transition relief. This may allow an employer to avoid some penalties if it can show that it made good-faith efforts to comply with the information reporting requirements for 2017.

This relief applies only to incorrect and incomplete information reported on the ACA forms, and not to a failure to file or furnish the forms in a timely manner. Additionally, the IRS stated it does not anticipate extending either the good-faith transition relief or the furnishing deadline in future years.

Contact a trusted tax professional if you have questions on how this may affect your business specifically.

Click here to read more about how the ACA is affect by the new Tax Cuts and Jobs Act.

Disclaimer: This blog includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer licensed in your jurisdiction for advice on specific legal problems.

Tags: , , , ,
Posted in ACA, Blog, Compliance, Featured

Erin Maxwell

by Erin Maxwell


Author Bio: As a compliance attorney for Paycom, Erin Maxwell monitors legal and regulatory changes at the state and federal level, focusing on health and employee benefits laws, to ensure the Paycom system is updated accordingly. She previously served as assistant general counsel at Asset Servicing Group in Oklahoma City. She holds a bachelor’s degree from the University of Central Oklahoma and a J.D. from the University of Oklahoma. Outside of work, Maxwell enjoys politics, historical mysteries and spending time with her family.

Employers Unaffected by ACA Changes in New Tax Law

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On December 22, President Trump signed the Tax Cuts and Jobs Act. The bill includes a provision that reduces the penalty for not complying with the Affordable Care Act’s (ACA) individual mandate to $0, effectively removing the penalty for individuals who do not have health insurance coverage after the effective date of Jan. 1, 2019.

However, this update will not impact employers, since the law does not remove the employer mandate (the requirement that large employers offer health insurance coverage to their full-time employees or pay a penalty) or the associated employer reporting requirements. Large employers subject to the mandate still face penalties if they fail to comply with either, and the IRS has begun sending out notices with preliminary assessments of the employer shared responsibility penalty for tax year 2015.

Employers subject to the employer mandate should continue to comply and be prepared to file Forms 1094 and 1095 with the IRS in accordance with the normal deadlines.

For the 2017 tax year, the deadlines to provide Forms 1095-C to employees is Jan. 31, 2018.  The deadline to file Forms 1094-C and 1095-C with the IRS is Feb. 28, 2018 if filing paper forms, and April 2, 2018, if filing electronically.

Disclaimer: This blog includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer licensed in your jurisdiction for advice on specific legal problems.

Posted in ACA, Blog, Compliance, Featured

Erin Maxwell

by Erin Maxwell


Author Bio: As a compliance attorney for Paycom, Erin Maxwell monitors legal and regulatory changes at the state and federal level, focusing on health and employee benefits laws, to ensure the Paycom system is updated accordingly. She previously served as assistant general counsel at Asset Servicing Group in Oklahoma City. She holds a bachelor’s degree from the University of Central Oklahoma and a J.D. from the University of Oklahoma. Outside of work, Maxwell enjoys politics, historical mysteries and spending time with her family.

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