Reporting Requirements for Letter Recipients
On the heels of many employers receiving Letter 226J Employer Shared Responsibility Penalty Assessments, the Internal Revenue Service (IRS) has started to send letters to employers that, according to IRS records, may have been an Applicable Large Employer (ALE), during the 2015 or 2016 calendar year but failed to complete the ACA reporting as required under Sections 6055 and 6056. Under the ACA, all ALEs must file Forms 1094-C and 1095-C with the IRS and furnish a copy of the 1095-C to all full-time employees. The insurance carrier for a fully insured plan must complete Forms 1094-B and 1095-B. Generally, only employers that are non-ALEs with a self-insured plan will complete Forms 1094-B and 1095-B.
For more information on ACA reporting requirements for ALEs, visit: ACA Reporting Requirements – FAQ
Recipients of this letter must mail a response to the IRS within 30 days of the date of the letter stating that it was the following:
- An ALE for the applicable calendar year and already filed Form 1094-C and Forms 1095-C with the IRS, and under what name, employer identification number (EIN), and date;
- An ALE for the applicable calendar year and is including a copy of their late Form 1094-C and Forms 1095-C to be filed non-electronically;
- An ALE for the applicable calendar year and will file their late Form 1094-C and Forms 1095-C, and under what name, EIN and date; or
- Not an ALE for the applicable calendar year, and an explanation of its non-ALE status.
Additionally, in responding to the letter, recipients must include their contact information, including a daytime phone number.
Notably, this letter is not an assessment of potential penalties despite noting that the recipient may be subject to penalties for failure to file and furnish information returns.
For more information on consequences for failure to complete ACA reporting, visit: Missed the 1095-C Deadlines: Now What?