Employer Penalty Update

Have you been keeping up with Capstone Compliance? Check out our recent update on the Employer Penalty.

Applicable large employers (“ALEs”) may be resting easy, having had no notification from the IRS of 2015 or 2016 assessments under the Employer Shared Responsibility Provisions (the Employer Penalty) and having reasonably expected that the Republican-led administration would limit or choose not to enforce this mandate.

However, the recent failure in the Senate to pass legislation to repeal and replace the Affordable Care Act (“ACA”) has left many employers wondering whether:

  • Penalties associated with the Employer Penalty will be enforced; and
  • Forms 1094-C and 1095-C will be required going forward

Recently, the IRS published draft versions of the 2017 Forms 1094-C (https://www.irs.gov/pub/irs-dft/f1094c--dft.pdf) and 1095-C (https://www.irs.gov/pub/irs-dft/f1095c--dft.pdf). These versions are substantially similar to past Forms. Notably though, the Form 1094-C has reserved areas once used to reflect available transition relief (Line 22 Certifications of Eligibility, Boxes “B” and “C”). Final versions of the Forms are expected in the fall. Draft instructions for the 2017 Forms have not yet been released.

To date there has been no guidance issued by the IRS that eliminates penalties for Employer Penalty violations or fines associated with failures to accurately complete, provide and/ or file Forms 1094-C and 1095-C. While some employers may think a Trump-led IRS will ignore these requirements, absent non-enforcement guidance from the agency, employers should continue to comply.

To read the full article, check out the Capstone Compliance website at http://www.capstonehealthreform.com/