Six Things Applicable Large Employers (ALEs) Need To Know About Information Reporting and Health Coverage Offers

Applicable Large Employers (ALEs) are generally those employers with 50 or more full-time employees, including full-time equivalent employees in the preceding calendar year. If you are an applicable large employer, did you know the Affordable Care Act requires your company to file data returns that report information with the IRS and with your employees as well? Under the Affordable Care Act, not only are you responsible for jumping through all the hoops of providing coverage for your employees, you also need to be the main source of reporting such information to the Internal Revenue Service.

Applicable Large Employers (ALEs) Under ACA

applicable large employers

Applicable Large Employers (ALEs)

As a full-service employee benefits and insurance agency serving Southern California, Pontrelli, Timour & Associates understand that Obamacare has been driving you crazy as a business owner. Luckily, we are here to help guide ALEs through the obstacle course of providing the right benefits at the right cost, while advising you on resources to ensure your reporting requirements are executed on time. We are here to help ease the frustrations of the ACA, and help you contain costs, while keeping your valued employees happy with their benefit options.

Although many employers are not ALEs, thus not subject to this health care tax provision, the employers that do fall under the ALE definition must take action. If you are an applicable large employer you must use Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and Form 1095-C, Employer-Provided Health Insurance Offer and Coverage. These IRS forms are used to report the information about offers of health coverage and enrollment in health coverage for their employees.

Here are six key points ALE’s need to know about the information returns they must file:

Six Key Points for Applicable Large Employers (ALEs)

  1. Form 1095-C is used to report information about each employee who was a full-time employee of the ALE member for any month of the calendar year.
  2. Form 1094-C must be used to report to the IRS summary information for each employer, and to transmit Forms 1095-C to the IRS.
  3. ALEs file a separate Form 1095-C for each of its full-time employees, and a transmittal on Form 1094-C for all of the returns filed for a given calendar year.
  4. Applicable Large Employers that offer employer-sponsored self-insured coverage use Form 1095-C to report information to the IRS and to employees about individuals who have minimum essential coverage under the employer plan.
  5. The information reported on Form 1094-C and Form 1095-C is used in determining whether an employer owes a payment under the employer shared responsibility provisions.
  6. Forms 1094-C and 1095-C, or a substitute form must be filed regardless of whether the ALE member offers coverage, or the employee enrolls in any coverage offered.

If you are an applicable large employer (ALE) and you have yet to file these forms, you are already sailing in treacherous seas. Luckily, Pontrelli, Timour & Associates can help applicable large employers right the ship of their companies and return to calm waters. The goal of PT Benefits is to make sure that our client companies that are ALE’s avoid unnecessary IRS fines while keeping in compliance. At the same time, we want to help you recruit and keep the best employees by offering you’re the best benefits program options available.

PT Benefits Can Help ALEs

To learn more about how PT Benefits can help applicable large employers, please contact us today by calling 626-795-4138 today.

Does Your Company Know About The Affordable Care Act’s Employer Shared Responsibility Payment?

Under the Affordable Care Act, applicable large employers – those with 50 or more full-time employees, including full-time equivalent employees – are required to take some new actions. Applicable large employers (ALEs) particularly need to pay attention. ALEs are subject to the employer shared responsibility provisions. A goal of Pontrelli, Timour & Associates is to provide our clients and potential clients with the best information available about the employer shared responsibility provisions and all the requirements of the Affordable Care Act. After all, information is the power to chart the right course.

The Affordable Care Act’s Employer Shared Responsibility Payment

employer shared responsibility payment

Employer Shared Responsibility Payment

Whether an employer is an applicable larger employer in a particular calendar year depends on the size of the employer’s workforce in the preceding calendar year. This is a key distinction to remember. To be defined as an ALE for a particular calendar year, an employer must have had an average of at least 50 full-time employees (including full-time-equivalent employees) during the preceding calendar year. All types of employers can be ALEs, including tax-exempt organizations and government entities.

To prepare for 2016, if your organization is an applicable large employer, you need to keep track information each month in 2015, including the following:

  • Whether you offered full-time employees and their dependents minimum essential coverage that meets the minimum value requirements and is affordable
  • Whether your employees enrolled in the minimum essential coverage you offered

PT Benefits can help our clients keep track of this information by providing supporting guidance and information.

Your company needs to track this information because you could be subject to an employer shared responsibility payment if your organization falls into either of these circumstances:

  • You offered coverage to fewer than 70 percent of your full-time employees in 2015 while at least one full-time employee enrolled in coverage through the Health Insurance Marketplace and receives a premium tax credit. The 70 percent threshold is for 2015, after 2015 this increases to 95 percent.
  • You offered coverage to at least 70 percent of your full-time employees and their dependents in 2015, but at least one full-time employee receives a premium tax credit because coverage offered was not affordable, did not provide minimum value or the full-time employee was not offered coverage. After 2015, this threshold increases to 95 percent.

 Pontrelli, Timour & Associates Can Help

Pontrelli, Timour & Associates understands if these requirements and logistics seem complicated. We can help you understand your company’s designation and take the steps to remain in compliance with the Affordable Care Act. Naturally, our goal is to help your company avoid an employer shared responsibility payment. To learn more and access the help you need, please call the group insurance experts at PT Benefits at 626-795-4138.Employer Shared Responsibility Payment

Do You Know How PPACA Affects Employers With 50 Or More Full Time Equivalent Employees?

In a recent update released on the IRS.gov website, the Internal Revenue Service offered Affordable Care Act guidance for large employers with 50 or more full time equivalent employees. Since some of the provisions of ACA apply only to large employers, which are generally those with 50 or more equivalent employees working full-time, the goal of this guidance is to let large employers know about deadlines approaching and compliance requirements that need to be met. As a group benefits and insurance leader for companies across Southern California, Pontrelli, Timour & Associates, Inc. offers this synopsis of the main points covered by the IRS in the recent update.

Large Employers Under The Affordable Care Act

50 or more full time equivalent employees

50 or more full time equivalent employees

If you have 50 or more full-time equivalent employees, your company is considered as an applicable large employers or ALEs. Applicable large employers are subject to the employer shared responsibility provisions and the annual employer information return provisions. For example, in 2016 applicable large employers will have annual reporting responsibilities in relation to health insurance. These reporting responsibilities detail whether your company offers health insurance to your employees and what kind of health insurance was offered in 2015 to your full-time employees.

Regardless of size, all employers that provide self-insured health coverage must file an annual return reporting certain information for the employees and other individuals they cover. The first returns are due to be filed in 2016 for the year 2015. Such filings have now become an inherent part of business tax filings with the IRS.

100 Or More Full Time Equivalent Employees

Effective for calendar year 2015, applicable large employers with 100 or more full-time or full-time equivalent employees will be subject to the employer shared responsibility provision. The shared responsibility provision goes hand-in hand with the possibility of having to make a shared responsibility payment. Like a penalty, the shared responsibility payment applies to employers that do not offer adequate, affordable coverage to their full-time employees. As a result of not offering such coverage, if one or more of those employees get a premium tax credit, the shared responsibility payment will be triggered for ALEs with 100 or more full time equivalent employees.

50 Or More Full Time Equivalent Employees

As for the smaller ALEs with 50 or more full time equivalent employees, but less than 100, the employer shared responsibility provisions will be activated from 2015 to 2016. Given this change and potential penalties involved, calculating the number of employees becomes of paramount importance. Any employers that have close to 50 employees or whose workforce fluctuates throughout the year should consult with a benefits administration expert to figure out exactly what they need to stay in compliance.

Although the basic calculation seems simple, it can be particularly complex given the natural fluctuations of a large workforce on an annual basis. The IRS describes the calculation needed:

To determine its workforce size for a year an employer adds its total number of full-time employees for each month of the prior calendar year to the total number of full-time equivalent employees for each calendar month of the prior calendar year and divides that total number by 12.

The Challenge Of 50 Or More Full Time Equivalent Employees

Did you know that employers with more than 50 cannot purchase health insurance coverage for its employees through the Small Business Health Options Program? With the SHOP Marketplace off limits, it becomes even more for employers with 50 more full time equivalent employees to work with a groups benefits provider like Pontrelli, Timour & Associates, Inc. that can answer your questions, lower your costs and help your company stay in compliance. To learn more about how PT Benefits can help, please call us today at 626-795-4138 to speak with a member of our customer-centric team.

100 Plus Employers Need To Be On Alert As IRS Releases Report About Responsibilities Of Employers Under ACA

When the IRS releases a report about the responsibilities of employers under the Affordable Care Act, Pontrelli, Timour & Associates feels the need to raise a red flag.  As a group benefits leader providing Southern California companies with healthcare solutions, PT Benefits wants employers to know that the end of 2014 signals a time to take action. If you are an employer, the number of employees in your business will affect what you need to know about the Affordable Care Act (ACA).

IRS Warns Companies With 100 Plus Employees

affordable care act, aca, 100 plus employers, Obamacare

100 Plus Employers

If you have at 100 full-time and full-time equivalent employees, providing affordable healthcare for your employees is no longer a choice. In the report, the IRS warns that the employer shared responsibility payment will be significant. This payment will happen, even if only one of your employees applies for and receives a subsidy or premium tax credit through a marketplace enrollment.

Moreover, starting in 2016, your company must report to the IRS information about the health care coverage, if any, you offered to your full-time employees for calendar year 2015. You also must furnish related statements to their full-time employees. As a direct result, such reports need to be developed and executed in 2015. As a full-services benefits solutions provider, Pontrelli, Timour & Associates will help advise our clients with resources to comply with these reporting requirements.

100 Plus Employers Employer Shared Responsibility

Although the IRS will not assess employer shared responsibility payments in 2014, this does not mean that you can sit on your hands and ignore the needs of your company. It is true that information reporting related to the employer shared responsibility provisions is voluntary in 2014. After 2014, employer shared responsibility payments will be assessed to companies with 100 plus employees and reporting will be required.

In addition, the employer shared responsibility provisions will be phased in for smaller ALEs from 2015 to 2016.  An ALE is an acronym that stands for Applicable Large Employer, meaning an employer that has 50 or more full time equivalent employees. As a result, although the immediate pressure is on 100 plus companies, 50 plus companies will be squeezed by the IRS as well.

ALEs Of All Sizes Are Ultimately Vulnerable

Specifically, ALEs that meet certain conditions regarding maintenance of workforce size and coverage in 2014 are not subject to the employer shared responsibility provision for 2015.  For 50 plus employers, no employer shared responsibility payment will apply in 2015.  50 plus employers are required to meet the information reporting requirements for 2015.  Despite this breather for 50 plus companies, the IRS wants to make it clear that such employers will be put under the microscope and fined in the future.

The reason Pontrelli, Timour & Associates is waving a red flag and raising the alarm is because too many ALEs and 100 plus employee companies have been avoiding dealing with the Affordable Care Act. What these companies need to realize is that the IRS is in charge of enforcing many of the statutes of the Affordable Care Act. The last thing you want is to place your company under an IRS microscope. If you can avoid dealing with the Internal Revenue Service, this is a good path to take, but you need to take action now.

Pontrelli, Timour & Associates Can Help

For information about and help with the Affordable Care Act and the employer responsibilities outlined by the IRS, please contact Pontrelli, Timour & Associates today. Our goal is to help our clients offer a robust employee benefits program that employees value, while respecting the organization’s budget, and keeping them in compliance.  To learn more about how we can help 100 plus employers and other ALEs, please call Pontrelli, Timour & Associates in Pasadena at 626-795-4138.