ACA Penalty Relief
This post is for Applicable Large Employers (ALEs) required to comply with the Affordable Care Act.
Here’s a success story written by Adam Miller, Passport Software’s HR Compliance Manager – we hope you find it helpful.
Letter 226 J
In October of 2018, a company received a penalty notice for several hundred thousand dollars for their 2016 ACA filing, and they asked if we could help.
We reviewed the details of their penalty notice (the 226J letter), their filed 2016 1094-C/1095-Cs, and the records of coverage offers they made.
While it was apparent they had made an effort to comply, a previous employee (since replaced) hadn’t understood the complexities of the Affordable Care Act.
Most of the penalties were due to errors in completing the forms, not a lack of compliance.
However, we did discover a handful of employees whose offers did not meet the affordability standard. After making their case to the IRS, their total penalty was reduced to under $20,000.
Unfortunately, the employee who had made the mistakes for 2016 had completely neglected to file for 2017.
The client purchased our software and we helped them report correctly. Several weeks ago, the client received another penalty notice for 2017.
Not because any offers were missed or too expensive, but because they had filed 6 months late.
This appeal is still pending, but one thing we know for sure is that there will be no issues for 2018—we helped them beat that deadline by 2.5 months.
Passport Software provides an affordable ACA Full-Service option or easy to use ACA Software with optional proxy submission.
We also offer consultation services for penalty notices and have helped many clients completely avoid, or greatly reduce, penalties.
Also, our Food Service Payroll and Affordable Care Act Software simplifies payroll processing and ACA compliance for restaurants and food service operations.
Call 800-969-7900 with questions for Adam. Or Contact Us for more information.