Blog

Monday, October 31, 2016

ACA Explained: Stability Periods

ACA - Stability Periods

Applicable Large Employers (ALEs) who have a significant amount of variable employees face special challenges under the Affordable Care Act’s employer shared responsibilities. In order to make sure they’re ACA compliant and can adequately determine who needs to be offered health coverage, ALEs with a workforce of hourly workers or workers without a set weekly schedule need to implement measurement and stability periods.

Choose Your Measurement Period Length
For this one, most employers are going to choose a 12-month look-back method for a few reasons:
  • Longer measurements periods lead to lower average hours by week and level out periods of high volume and scheduling.
  • They also give employers an opportunity to manage their workforce in terms of scheduling if they trend higher average hours.
Employers can choose a shorter measurement period.This helps to more aggressively account for the fluctuation in hours variable employees have. Shorter measurement periods also allow employers to manage benefits costs with industry-relevant time periods, like school semesters in education fields, tax season in accounting fields, and harvesting time in the farming industry.

Choose Your Stability Period Length
When choosing your stability period, keep in mind that it needs to align with your medical plan or health insurance annual open enrollment and plan year. This eases your administrative burden and ensures your cost projections are in line with the premium cost increases and decreases at the Exchange level.
Determine Your Administrative Period Length
Your administrative period cannot be any longer than 90 days, so depending on your measurement period, your administrative period will likely be between 30-60 days. If you don’t have an administrative period, you risk retro enrollments and may need to collect back premiums.

Calculate and Repeat
Once your periods are set, your data collection for assessing service hours over your measurement period can begin. If you get overwhelmed by all the spreadsheets and data that’s required to be manually analyzed for your ACA compliance on a regular basis, ask for a demo with ACAwise! Our software not only e-files your ACA reporting, it also monitors and measures your employees during the periods you set up to ensure your ACA compliance all year long.


Read More »

Wednesday, October 26, 2016

ACA Explained: Determining Employee Affordability

ACA - Determining Employee Affordability

We’ve talked about how important it is that the health insurance you offer your employees meets minimum essential coverage and value. One of the key components in making sure it meets these requirements is that it’s affordable.

The law is called the Affordable Care Act, after all.

So how exactly do you determine the affordability of the coverage you offer? Well, according to the IRS, it should cost the employee no more than 9.5% of their annual household income. But it’s unlikely that you know the household income of all of your employees - you’ve got a lot on your plate as it is. Luckily, you’ve come to the right blog!

The IRS allows three optional safe harbors for employers to use to determine coverage affordability to help keep in line with the employer shared responsibility provisions. You can choose to use one or more of the safe harbors for all of your employees, provided you do so on a uniform and consistent basis for all employees.

The Form W-2 Wages Safe Harbor
This form of safe harbor is based on the amount of wages paid to each employee. The employee’s wages are determined using Box 1 of that employee’s Form W-2.

The Rate of Pay Safe Harbor
The rate of pay is based on the employee’s rate of pay at the beginning of the coverage period. Adjustments are permitted for hourly employees if the rate of pay is decreased but not if it’s increased.

The Federal Poverty Line Safe Harbor
This safe harbor treats coverage as affordable if the employee contribution for the year does not exceed 9.5% of the federal poverty line for a single individual for the applicable year.

You can use these safe harbors to determine affordability and more with ACAwise! It’s the complete solution for ACA compliance management and e-filing. Schedule a demo with us or sign up today!


Read More »

Monday, October 24, 2016

Are You Ready for Section 6055 and 6056 Reporting?

Are You Ready for Section 6055 and 6056 Reporting?

Whether or not you were a boy scout growing up, their lifestyle of always being prepared is handy to adopt and apply to your own life, especially when it comes to the IRS.

Beginning January 1st last year, it became a requirement for certain employers to maintain detailed information about the health care coverage they offer to their employees. This is due to regulations published under the IRS’s Internal Revenue Code, Sections 6055 and 6056.

Section 6055 & 6056 Requirements
IRS Code Section 6055:
  • - Employers with self-funded plans and insurers who manage fully insured plans must report information about the organization providing coverage.
  • - This includes company contact information as well as a detailed list of employees that shows the months each was covered during the calendar year.
IRS Code Section 6056:
  • - Employers must report information about the employer offering coverage.
  • - This information includes a list of full-time employees and the coverage offered to them each month, as well as the cost of coverage.
  • - Employers are also required to provide information about the employee’s covered dependents.

Reporting Requirements
All employers who are considered Applicable Large Employers (those with more than 50 full-time employees) have to file the information required in Sections 6055 and 6056 with the IRS each year. The IRS’s general requirements surrounding reporting include:
  • -Detailed information of each employee - name, address, and Social Security Number - for each calendar month
  • -The total number of full-time employees
  • -Whether or not the coverage offered to each employee met Minimum Essential Coverage and Minimum Value
  • -Whether or not the coverage offered was affordable, and how much each employee was required to pay
  • -Whether or not the coverage was offered to all full-time employees and their dependents

Start Planning Now
We’ve already had a taste of IRS ACA filing this year with the 2015 reporting. However, with shorter deadlines and fewer Safe Harbor lifelines, 2016 reporting stands to be more stressful. That’s why it’s important to have a plan in place well ahead of time for handling your ACA compliance.

This is where ACAwise comes in: ACAwise is an all-in-one solution for employers and third party providers alike. With ACAwise, you can track and manage your compliance throughout the year. Then, to ensure your return is filed on time, it automatically creates Forms 1094 and 1095 in accordance with the data you provide and the IRS’s ACA regulations found in Sections 6055 and 6056.

Head on over to ACAwise, an ACA compliance software today to schedule your free demo and get started for your 2016 filing!


Read More »

Wednesday, October 19, 2016

How to Determine Employee Eligibility for Health Coverage

How to Determine Employee Eligibility for Health Coverage?

We’ve already talked a bit lately about the employer shared responsibilities that are now required thanks to the new Affordable Care Act provisions. Because of new rules like the Play or Pay Mandate, certain employers have to provide health insurance coverage to at least 95% of their full-time employees or make an employer shared responsibility payment.

Since it’s important to follow these rules and regulations to a tee, you’ll want to make sure that you and the IRS are on the same page concerning your employees who are eligible to receive health insurance offers.

For starters, the IRS considers 30+ hours a week (or 130+ hours in a month) to be full-time. If you were only going to look at your 40+ hour a week, you’d already be off on the wrong foot.

The IRS also expects you to include hours for which the employee is entitled to payment but no job duties are performed - in addition to the normal service hours they put in for the business - in their total hours to determine full-time status. These include hours like:
  • - Paid Family and Medical Leave of Absence (FMLA)
  • - Vacation days
  • - Sick days
  • - Military leave
  • - Days off for jury duty
And just as there are hours the IRS thinks you should include (see above), there are hours the IRS does not consider hours of service. So time spent volunteering, in a work study program (like an internship), or earning foreign-sourced income doesn’t need to be included in your total tally.

So now that you know all of the hours to consider, there are three ways to determine an employee’s eligibility for an offer of health insurance coverage:
  • 1. You can total up the actual hours of service each month for each employee (which may get a little difficult with the salaried employees).
  • 2. You can total up the number of days each month each employee did at least eight (8) hours of work.
  • 3. You can total up the number of weeks each month the employee did 30 hours of work.

And, of course, there are some conditions with whichever method you choose:
  • - Pick a method and stick to it for the entire year. You’re not allowed to switch it up and change methods until next year’s reporting.
  • - Methods 2 and 3 can be used to classify your salaried employees, you’ll just need to keep the classifications consistent.
  • - You cannot use Methods 2 or 3 if their results understate the employee’s hours and bring them below the full-time employee hour minimum.

Stay tuned with ACAwise, an  ACA reporting software for more ACA wisdom and know-how. And be sure to sign up for a free demo or account so when it’s time to report the coverage you offered to your full-time employees, you’ll be ready to easily and securely e-file Forms 1094 and 1095 to the IRS!


Read More »

Monday, October 17, 2016

ACA Management Software to Track Your Business's Health Care Reform

Track Your Business's Health Care Reform with ACA

We’ve been talking quite a bit about ACAwise and all the new and exciting features it’s bringing to the world of Affordable Care Act compliance and e-filing, but did you know that ACAwise is available now?

That’s right: we had our official unofficial launch just a little over a week ago, so now we’re just waiting for you!

Read our blogs and check out our website to learn more, but the best way to learn what ACAwise can do for you and your ACA compliance needs is to request a free demo and create your own ACAwise account.

Once you’re in your account, you’ll provide a little bit of information about the person filing the compliance returns (that’s you), the person for whom you’re filing compliance (which may still be you), and the people who received health insurance throughout the year. And all of this may vary a little bit, depending on whether you’re an ALE (Applicable Large Employer) or TPA (Third Party Administrator). This is why every ACAwise account is customized to the account owner’s needs, and why you should request your account sooner rather than later!

As you may already know, the ACA deadline for Forms 1094 and 1095 is back to its regularly scheduled March 31 (for e-filers) this year. And since we’re one of the few people who do what we do (and at the competitive prices we do!), we’re anticipating things will only get busier from here. Get ahead of the crowd and request a demo today.

We’ve got personal account managers standing by to custom-create your account as well as answer any questions you may have! To request a demo, go here; to jump in and create an account, go here. And if you have any questions, call (704) 954-8420 or send an email to support@ACAwise.com.

Related Blog: The Future of ACA Compliance Management Has Arrived


Read More »

Wednesday, October 12, 2016

Challenges Employers Face Under the Affordable Care Act

Challenges Employers Face Under the ACA

Running a business is no piece of cake. Even before the Affordable Care Act, each day had its own unique challenges that needed to be addressed. Now that the ACA has passed and we’re all subject to it, there are even more challenges employers face to remain compliant.

Challenge #1: To Play or Pay
We touched on this new mandate of a challenge last week, but to catch you back up to speed, employers basically have two options: to play along with the new ACA regulations and offer health insurance coverage to their full-time employees or pay a per-employee fine on their IRS return.

So employers have to decide, would it be more worth it, in the end, to provide health insurance for their employees all year or pay the $2000 per employee fine to the IRS?

Challenge #2: Determining Eligibility
There are a lot of questions employers need to answer when going over the ACA eligibility requirements, which include variables that affect employee populations and demographics differently. Some key questions to mull over before you dive into your ACA compliance are:

Challenge #3: IRS Reporting
And just when you get through challenges one and two, there’s challenge three: reporting ACA Forms 1094 and 1095 to the IRS. A lot of employers are worried about how this reporting will go down: who’s going to do it? And how much will it cost??

Well, worry no more, because this is where we can offer some relief! ACAwise is an all-in-one compliance management and e-filing cloud-based software. It’s designed to work with the information you already have, so set-up’s a breeze. Once your employees’ data is in the secure ACAwise system, the program tracks the data against IRS-issued business rules and regulations to ensure your compliance.

Then, when the IRS is ready to begin accepting Forms 1094 and 1095 via e-file (usually early January), ACAwise will create your ACA return for you! All you have to do is review and approve the forms and we’ll securely e-file them straight to the IRS at a fraction of the cost of our competitors. We even have a nifty postal mailing feature where you have us send out your recipient copies of Form 1095 for you! They leave our South Carolina-based headquarters by the next business day after you e-file.

Head on over to ACAwise now to request a demo and set up your very own account!

Read More »

Monday, October 10, 2016

The Basics of ACA Form 1095

Determine Employee Eligibility for Health Coverage

If you’re new to the ACA game, you may be wondering what all this talk about 1095 forms is. Even if you’re not, it’s been a while since we last filed them, so it’s probably about time for a refresher course.

So let’s dive right in, shall we?

What are the 1095 Forms?
When the Affordable Care Act was passed, it made it so that employers with 50 or more full-time employees were required to provide affordable health insurance that meets a set minimum coverage and value. Other providers of insurance were also affected as they now have to meet these same minimum requirements with the coverage they offer.

But what’s that got to do with the 1095 forms, you ask? Well, in order to make sure everyone - employers, insurance providers, and taxpayers alike - is compliant with the ACA, the IRS created Form 1095 to report the coverage offered throughout the year to each taxpayer.

Employers complete a Form 1095-C for every full-time employee who was offered coverage throughout the year, and other insurance carriers must file Form 1095-B for each recipient of coverage. Individual taxpayers who receive insurance from the Marketplace receive Form 1095-A to prove their coverage.

Filing Form 1095
When employers or insurance providers file Form 1095, they must file one copy with the IRS for compliance purposes and must send another copy to the coverage recipient so they can use it to file their personal tax return. It’s important to note, however, that the copy of Form 1095 sent to recipients is for their records and is not to be sent to the IRS along with their tax return.

Whichever Form 1095 is filed, a copy of Form 1094-B or C is sent to the IRS along with the complete 1095 return. Form 1094 can be seen as a cover sheet that summarizes the 1095 return it accompanies. Form 1094 does not need to be sent to the recipients of insurance, only to the IRS.

Complete Your 1095 Forms with ACAwise
ACAwise is an all-in-one ACA reporting software designed to track and monitor your ACA compliance all throughout the year. But one of the best parts is once it’s done all that, it then creates your 1095 and 1094 forms for you! Then you just review them and securely e-file them with the IRS. We’ll even throw in postal mailing, where we send your recipient copies of Form 1095 out for you from our headquarters in South Carolina!

Head on over to ACAwise.com now to request a demo or to get started creating your account!


Read More »

Friday, October 7, 2016

The Future of ACA Compliance Management Has Arrived

The Future of ACA Compliance Management has Arrived

That’s right folks, it’s official: alert the presses and sound the alarms, ACAwise is officially live!

Well, a lite version of ACAwise is live. With less than three months left in 2016, there’s only so much that can be done regarding compliance tracking and coverage offers that maybe should’ve been made already.

But don’t worry: all of that will be ready to go for 2017. In the meantime, you can sign up for an account to explore the program, learn more about ACA compliance software, and even begin preparing your ACA filing for next year.

And while you’re doing that, why don’t we tell you a bit about the recent history of ACAwise and its journey to today's launch.

The 2015 tax filing season earlier this year was the first time it became mandatory for ACA Forms 1094 and 1095 to be filed. ALEs and service providers alike were scrambling for secure, reliable e-filing. Even the deadline extensions the IRS instated didn’t seem like enough.

SPAN Enterprises, ACAwise’s parent company, did everything they could to provide the secure e-filing people needed. ACA Forms 1094 and 1095 were added to the ExpressIRSForms line-up, and ExpressACAForms was launched to transform any ACA data in any file format into e-file-able 1094 and 1095 Forms.

But we realized the filers needed more. There seemed to be established compliance programs, as well as established e-filing programs, but nothing that brought the two together in a simple and seamless solution. Believe it or not, with ACA and IRS regulations to follow, making that connection is a lot more complicated than it seems.

Thankfully, the research that went into developing ExpressACAForms and the experience from the 2015 ACA filing season gave us the edge when developing ACAwise. Now, not only is ACAwise a year-round, all-in-one compliance management program, it also comes with one of the most secure, reliable e-filing systems available. It’s the perfect solution to have with you as you go into 2016 ACA filing at the beginning of next year.

You can create an account today with ACAwise, so what are you waiting for? Get on over there and sign up! And if you have any questions in the meantime, our support staff is happy to help! Give us a call at (704) 954-8420 (or) send us an email to support@acawise.com.

Related Blog: Introducing ACAwise


Read More »

Monday, October 3, 2016

The Affordable Care Act Play or Pay Mandate

The Affordable Care Act Play or Pay Mandate

Remember going over those employer shared responsibility provisions last week? If not, we’ll give you a moment to refresh your memory because they come back into play today!

(*Jeopardy theme music*)

Play or Pay
So now that we’re all back on the same page, we remember that the ESR provisions require all Applicable Large Employers (ALEs) to either provide affordable health insurance to a majority of their 50 or more full-time employees (or) pay a per-employee fee toward a publicly provided system that covers people without private insurance.

This choice - which, for some, is more of a catch-22 than it may seem at first - has become more colloquially known as the Play (or) Pay Mandate.

For the 2015 tax year, the Play or Pay Mandate only applied for ALEs with 100 or more full-time employees. For the 2016 tax year, which we’ll be filing in a few short months, the Play or Pay Mandate applies to all ALEs.

But You Do Have Another Choice
When it comes to the numbers, a lot of employers have been having difficulty deciding which is better: to play or pay? Employers do want to provide health benefits that are valuable to their employees, but they also want to provide it at a rate that’s beneficial for the cost. So what’s an employer to do?
  • - You can play and offer health insurance that meets minimum essential coverage and value to your full-time employees.
  • - You can pay and instead of offering health insurance to your employees you would pay a tax penalty.
  • - Or you can play differently. This is the middle ground option where you offer employees a health benefits allowance rather than choosing a group health insurance plan. So your employees would purchase their own policies, and you’d reimburse them for their policies, up to the amount of their allowance.
    • Fair warning: this option can still cause you to incur penalties if your health benefits allowance doesn’t meet coverage requirements.
So when you’re choosing what to do, compare the costs and benefits of these three options and see which works best for your business:
  • - Qualified, affordable group health insurance
  • - Premium reimbursement program and applicable penalties
  • - Penalties

Be sure to stay tuned for more ACA compliance and e-filing information, brought to you by ACAwise, the number one solution in ACA compliance and e-filing!


Read More »