Due to the Affordable Care Act (ACA), every employer with 50 or more full-time employees (including full-time equivalent employees) must report information about its 2015 workforce and health plans to its employees and the IRS using new Forms 1095-C and 1094-C.

Small employers with less than 50 full-time employees (including full-time equivalent employees) generally are exempt from this reporting requirement. However, small employers that are related to other companies due to common owners or services may be required to file the forms.

The forms disclose whether the employer offered ACA-compliant coverage to its employees and the identity of related employers. The first due date for these forms is Jan. 31, 2016, and penalties of up to $500 per form can apply. The IRS will use the information on these forms to assess employer shared responsibility payments on employers that do not offer health coverage that meets ACA standards.

Employers should act now to ensure that systems are in place to timely file the forms. We recommend that employers contact their payroll vendor or payroll software provider to discuss form preparation options. Professional tax assistance may be needed to identify related employers.

For further details, please read McGladrey’s articles about the Forms 1095-C/1094-C reporting requirements and the employer shared responsibility penalties. Other ACA information, including recorded webcasts on these topics, is available on McGladrey’s Affordable Care Act resource center.

The ACA rules are complex, and all employers need to analyze how the rules apply to them. We have ACA specialists who can help. Please contact Eric Bell at 541-342-5161 or ebell@islercpa.com if you have questions or would like assistance.