The IRS is making a statement in the new year, they are cracking down on ACA reporting. The Notice 972CG is proof of this. The IRS is currently distributing the penalty notices for tax year 2017. Applicable large employers all over the nation are being hit with these penalty notices and as the IRS catches up on the most recent tax years, there will be more on the way…
Let’s talk about the Notice 972CG in depth. We hope that you never get one, but here’s what you need to know if you do.
Why Did I Get Notice 972CG?
If this fun little bundle of papers showed up in your mailbox…here’s why.
You may have filled using the incorrect method. If you have more than 250 employees, you are required to e-file with the IRS rather than paper-file.
You filed your ACA Forms 1094 and 1095 with incorrect TIN’s or similar information and you didn’t correct them.
You filed your Forms 1094 and 1095 late.
What Is Included In My Notice 972CG?
The IRS is sending you a couple of different items in your Notice 972CG. Here are the key parts of the notice that you will need to peruse.
There will be an explanation of the penalty that you have received.
They will include a record of every return that you are being penalized for as well as every submission that they have considered as part of your penalty.
There will be a response page and a payment/correspondence slip.
How Do I Respond?
Now that you have received the penalty notice, you must respond. The IRS will give you a 45 day window to answer this notice. If you are a foreign filer then you will have 60 days to answer. Keep in mind, this window begins on the date that your notice was issued.
You have three options when it comes to responding. You can…
If you “fully agree” or “partially agree”, you must include a payment with your correspondence slip.
If you are a rebel and you “totally disagree”, you have to back it up with information. You must submit a written statement that explains why you are requesting that the IRS waive your penalty. This statement has to be signed by the person responsible for filing. Don’t forget, if you respond late, your request will be denied.
What Are The Penalty Rates?
The ACA penalties can be high enough to make you cringe. Also, the longer you ignore them, the larger they get. Initially you can be charged $50-$100 per return. If you ignore this penalty it can rise to as much as $260. Think about how many employees you have…this is going to add up fast!
Who Can Help Me?
ACA penalties are scary…but they don’t have to be. The team of experts at ACAwise are here to help you through it. We can answer your questions and help you decide how to proceed. ACA can assist with prior year filings and we have built in error checks to ensure accurate reporting. When it comes to ACA reporting, you don’t have to go it alone. Reach out to our team today for more information!