There are many different types of businesses and organizations that are required to complete ACA reporting under the Affordable Care Act guidelines.
While we don’t often think of a school district as a traditional employer, like a for-profit business, these entities are often required to report their employees’ health insurance to the IRS.
Here is an overview of how the Affordable Care Act (ACA) treats school districts and what is required of them.
What is ACA Reporting?
ACA Reporting is required under the Affordable Care Act. This is an IRS requirement for Applicable Large Employers and other entities that offer health insurance to employees or individuals.
The IRS requires these entities to file Forms 1094-B and 1095-B or 1094-C and 1095-C annually as well as to issue the individuals they offer coverage to with a copy of the 1095 forms.
Why you may ask? This is a way for the IRS to verify that all entities required to offer health insurance coverage per the ACA requirements are indeed doing so and that they are offering coverage that is affordable.
What is an Applicable Large Employer?
An applicable large employer is an employer with 50 or more full-time or full-time equivalent employees.
Full-time equivalent employees are part-time employees that collectively work enough hours (130 per week) to be considered full-time employees. This is important because these employees must be counted towards the total number of full-time employees.
How are School Districts Treated under the ACA?
If a school district is determined to be an “applicable large employer” under the ACA. It must offer minimum essential coverage that is affordable to all its full-time employees and report that to the IRS.
School districts with at least 50 full-time employees in any month of the calendar year are considered “large employers” and are subject to employee shared responsibilities.
In other words, any school district that qualifies as a large employer must provide “affordable health coverage” of “minimum value” to all “full-time employees” and their dependents.
For educational organizations like school districts, there is a special rule that includes breaks of at least four consecutive weeks, such as a summer vacation.
As a result, school districts must either exclude summer vacation when calculating average hours or consider giving employees credit for hours worked during the break.
Any employee who works or is expected to work 30 hours or more per week for nine months during the school year is considered a full-time employee of a school district and must be offered affordable health insurance coverage.
ACAwise Supports ACA Reporting for School Districts