And Now For Something Completely Compliant! – Upcoming ACA Reporting Deadlines
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
RISQ Consulting is pleased to remind you of the upcoming ACA reporting deadlines. Please take note of the dates and requirements to ensure your company is keeping all your ducks in a perfect row. And now for something completely compliant!
Affordable Care Act (ACA) reporting under Section 6055 and Section 6056 for the 2021 calendar year is due in early 2022. Specifically, reporting entities must:
- Furnish statements to individuals by March 2, 2022; and
- File returns with the IRS by 28, 2022 (or March 31, 2022, if filing electronically).
Penalties may apply for reporting entities that fail to file and furnish required returns and statements by the deadline.
A proposed rule issued on Nov. 22, 2021, extended the annual furnishing deadlines under both Sections 6055 and 6056 for an additional 30 days. This rule is in proposed form and has not been finalized. However, reporting entities may rely on the proposed rule for 2021 reporting, even before it is finalized. Reporting entities are generally encouraged to furnish statements to individuals as soon as they are able.
Important Dates
- February 28, 2022 – Deadline for 2021 filing with the IRS in paper form
- March 2, 2022 – Deadline for furnishing 2021 Forms 1095-B and 1095-C to individuals
- March 31, 2022 – Deadline for 2021 filing with the IRS electronically
Action Steps
The IRS generally encourages reporting entities to furnish statements as soon as they are able.
Although penalty relief has been provided in prior years for reporting entities that make good faith efforts to comply with the reporting requirements, this penalty relief is not available for reporting for tax year 2021 and subsequent years. This good faith relief was intended to be transitional to accommodate public concerns with implementing new reporting requirements under the ACA. These reporting requirements have now been in place for six years, and the IRS has determined that transitional relief is no longer appropriate. Therefore, the IRS has discontinued the transitional good faith relief after tax year 2020.
Section 6055 and 6056 Reporting
- Section 6055 applies to providers of minimum essential coverage (MEC), such as health insurance issuers and employers with self-insured health plans. These entities generally use Forms 1094-B and 1095-B to report information about the coverage they provided during the previous year.
- Section 6056 applies to applicable large employers (ALEs)—generally, those employers with 50 or more full-time employees, including full-time equivalents, in the previous year. ALEs use Forms 1094-C and 1095-C to report information relating to the health coverage that they offer (or do not offer) to their full-time employees.
The ACA’s individual mandate penalty was reduced to zero beginning in 2019. As a result, the IRS has been studying whether and how the Section 6055 reporting requirements should change, if at all, for future years. Despite the elimination of the individual mandate penalty, Section 6055 reporting continues to be required. A proposed rule described below would provide that individual statements do not have to be furnished if certain requirements are met. However, this proposed rule has not been finalized.
Annual Deadlines
Generally, forms must be filed with the IRS annually, no later than Feb. 28 (March 31, if filed electronically) of the year following the calendar year to which the return relates. In addition, reporting entities must also furnish statements annually to each individual who is provided MEC (under Section 6055) and each of the ALE’s full-time employees (under Section 6056). Individual statements are generally due on or before Jan. 31 of the year immediately following the calendar year to which the statements relate.
Extended Furnishing Deadlines
The proposed rule provides an automatic extension of 30 days to furnish statements (Forms 1095-B and 1095-C) to individuals under Sections 6055 and 6056. Because the extension is automatic, reporting entities do not need to formally request an extension from the IRS.
Under the proposed rule, statements furnished to individuals will be timely if furnished no later than 30 days after Jan. 31 of the calendar year following the calendar year to which the statement relates. If the extended furnishing date falls on a weekend day or legal holiday, statements will be timely if furnished on the next business day.
This rule is in proposed form and has not been finalized. However, reporting entities may rely on the proposed rule for 2021 reporting, even before it is finalized.
Impact on Filing Deadline
The proposed rule does not extend the due date for filing Forms 1094-B, 1095-B, 1094-C or 1095-C with the IRS. This due date remains Feb. 28, if filing on paper, or March 31, if filing electronically. Because the due dates are unchanged, potential automatic extensions of time for filing information returns are still available under the normal rules by submitting Form 8809. Additional extensions of time to file may also be available under certain hardship conditions.
Alternative Method of Furnishing Under Section 6055
The individual mandate penalty has been reduced to zero, beginning in 2019. As a result, an individual does not need the information on Form 1095-B in order to calculate his or her federal tax liability or file a federal income tax return. However, reporting entities required to furnish Form 1095-B to individuals must continue to expend resources to do so.
For all years that the individual mandate penalty is zero, the proposed rule provides an alternative manner for a reporting entity to furnish statements to individuals under Section 6055. Under this alternative manner of furnishing, the reporting entity must post a clear and conspicuous notice on its website stating that responsible individuals may receive a copy of their statement upon request. The notice must include an email address, a physical address to which a request may be sent and a telephone number to contact the reporting entity with any questions. Reporting entities must generally retain the website notice until Oct. 15 of the year following the calendar year to which the statement relates.
ALEs that offer self-insured health plans are generally required to use Form 1095-C, Part III, to meet the Section 6055 reporting requirements, instead of Form 1095-B. Self-insured ALEs may use this relief for employees who are enrolled in the ALE’s self-insured plan and who are not full-time employees of the ALE, as well as for nonemployees (such as former employees) who are enrolled in the self-insured plan. However, ALEs may not use the alternative method of furnishing for full-time employees who are enrolled in the self-insured plan.
If, in the future, the individual mandate penalty is not zero, the IRS anticipates that reporting entities will need adequate time to develop or restart processes for preparing and mailing paper statements to responsible individuals. If the individual mandate penalty is modified in the future, the IRS anticipates providing guidance, if necessary, to allow sufficient time for reporting entities to restart the reporting process.
Elimination of Good Faith Transition Relief from Penalties
For each prior year of reporting, the IRS has provided transitional good faith penalty relief for reporting entities that could show that they made good faith efforts to comply with the information reporting requirements. However, the transitional good faith relief from penalties for reporting incorrect or incomplete information on information returns or statements is not available for reporting for tax year 2021 and subsequent years.
This good faith relief was intended to be transitional to accommodate public concerns with implementing new reporting requirements under the ACA. These reporting requirements have now been in place for six years, and the IRS has determined that transitional relief is no longer appropriate. Therefore, the IRS has discontinued the transitional good faith relief after tax year 2020.
- Published in Blog
Employee Wellness Trends to Watch in 2022
This article is from RISQ Consulting’s Zywave client portal, a resource available to all RISQ Consulting clients. Please contact your Benefits Consultant or Account Executive for more information or for help setting up your own login.
The workplace continues to change as the two-year mark of the COVID-19 pandemic approaches—and employer-sponsored wellness programs are no different. The pandemic has put employee health and wellness in the spotlight, and employers’ wellness initiatives will continue to grow in 2022. According to the Business Group on Health’s 2022 Large Employers’ Health Care Strategy and Plan Design Survey, employers recognize that COVID-19 may have long-term impacts on employees. Notably, many employers anticipate increasing medical services due to delayed care (94%) and are concerned about long-term mental health issues (91%).
Given the pandemic’s immediate and lasting impacts on employee health, it’s no surprise that employers are expected to expand their wellness offerings in 2022. Here are four popular employee wellness trends to look out for in 2022.
1. Expanded Mental Health Resources
Many organizations have prioritized mental health during the pandemic. Many workers continue to battle stress and anxiety in both their personal and work lives. Not only are employees faced with changing workplace policies and responsibilities, but they are also navigating how to reconnect with friends and family. Fortunately, the mental burden of the COVID-19 pandemic has enabled more transparency and empathy around the topic, especially in the workplace.
Many employers will continue to work on ways to address employees’ short- and long-term mental health issues, as there’s a significant need and desire for mental health support in the workplace. According to a 2021 Calm for Business workplace mental health survey, 97% of employees said that employers should be trying to improve employee mental health. Consider the additional survey findings:
- 76% of employees find mental health benefits critical when evaluating a new job.
- 87% of employees feel nervous, anxious or stressed working through a pandemic.
- 80% of employees are having difficulty falling and staying asleep during the pandemic.
- 43% of employees attribute poor mental health to their job based on a lack of recognition and belonging.
Employers who are invested in their employees’ mental health often yield healthy employees who take fewer days off, contribute to positive workplace culture and are more productive. One way to address employee mental health is by ensuring mental health is an essential part of overall health care offerings. Additionally, employers may expand telebehavioral health and employee assistance program (EAPs), as well as increase the use of mental health apps. Employers who provide diverse health care resources that deliver behavioral, emotional and social services are in a great position to improve their workforce’s overall well-being.
2. Advancement of Health Equity
The pandemic has undoubtedly shed light on health disparities. Several underlying social and economic challenges (e.g., health care, income and childcare) can influence overall well-being. To tackle health inequalities, some employers are making employee benefits and wellness programs more affordable and inclusive. The goal is to ensure all employees have access to the health care they need. That can look different for every employee, so employers may start with focusing on general goals to help employees manage any chronic conditions or severe acute needs, such as cancer, or receive recommended prenatal care.
Furthermore, some health insurance providers are working with local, state and federal governments to improve health equity to ensure Americans have an equal opportunity to thrive and achieve their best health. Employers can select providers striving to make health care more affordable and accessible to all employees. Employers have a great chance to help employees maximize their full health potential by supporting efforts that advance health equity in the communities where employees live and work.
3. Increased Focus on Hybrid Work-life Balance
Employee wellness programs must continue to evolve to meet the demands of the current workforce. At this point in the pandemic, it appears the hybrid workplace is here to stay. As such, many employers are shifting their perspective of hybrid work from a novelty to the new standard in 2022; but with that shift, employers must recognize the unique challenges employees face as hybrid workers. As the boundaries between work and home are blurred, employees may experience burnout or undergo a decrease in their physical or mental health.
A healthy work-life balance seems like an unattainable goal for many Americans. Still, employers can do their best to help and offer robust resources and support, especially for hybrid or remote employees. A holistic approach helps address all aspects of the body and mind. Health plans may include access to mental health professionals and assistance dealing with stress and depression. To support varying personal responsibilities, organizations may also consider how to increase schedule flexibility or time off for mental health or recharging. Such companies may also be focusing on key performance indicators like employee satisfaction and retention. As more organizations operate in hybrid or remote settings, employees are more likely to expect such comprehensive wellness offerings from their employers.
4. Expanded Financial Wellness Resources
Money is a top stressor for employees, and the pandemic has reinforced that fact. Seventy-three percent of Americans rank their finances as their number one source of stress, according to a 2021 CreditWise survey. As the pandemic evolves, employers are uniquely positioned to support employees with much-desired financial guidance and educational resources.
First, employers should be aware of the most common financial goals of employees:
- Building an emergency savings
- Navigating cashflow changes
- Choosing the proper health insurance and benefits
- Preparing for significant life events
- Saving for retirement
Many organizations employ a multigenerational workforce, which means employees often face unique financial stressors. To provide relief, some employers offer financial wellness programs that vary in complexity but can include virtual personal financial planning meetings, tuition reimbursement and seminars. The idea is to provide a wide variety of services for the workforce. Employers can help reduce employee financial stress by exploring financial wellness resources and support options and offering attractive programs for current and prospective employees. Financial wellness is a critical component of well-being and can be a competitive offering in today’s labor market.
Conclusion
All signs indicate that mental and financial wellness will become significant pain points in 2022. The pandemic also continues to expose health inequalities and an unattainable work-life balance for many American workers. The most robust 2022 employee wellness offerings and programs will likely be employee-centered, focusing on how to provide the most comprehensive, attainable and affordable benefits. Many employees will not only need resources for handling new pandemic-related mental and financial challenges but also support for working in a remote or hybrid setting as the lines blur between their home and work lives. This year, employers are expected to explore programs and initiatives that ensure all employees have access to the physical, mental and financial benefits they need to address the pandemic’s short- and long-term impacts.
Organizations can start with evaluating current wellness initiatives and thinking about ways to improve them. To ensure offerings and investments will resonate with the workforce, it can be helpful to survey employees first and see what they find most valuable and necessary for their overall well-being after two years of living through a pandemic.
Contact RISQ Consulting today for more wellness program ideas or ways to get started.
- Published in Blog