Growing Businesses–What You Don’t Know About the Affordable Care Act Could Cost You!

Affordable Care Act.

Is your company just about to pass or recently passed the 50 employee mark? That’s great news – your company is growing! Unfortunately, it also means increased regulation including potential eligibility to the Affordable Care Act (ACA).

The IRS recently released the draft instructions for the Form 1094-C and Form 1095-C. Any employer with 50 or more employees is required to complete these forms to report information regarding offers of health coverage and enrollment in health coverage for their employees. It is the government’s way of monitoring Affordable Care Act compliance. Now is the time to take the appropriate steps to ensure your company will be compliant with the ACA requirements when eligible. Businesses that did not have to comply with Affordable Care Act regulation for 2015 are not necessarily off the hook for 2016.

Businesses in and around this employee count need to carefully consider the following:

  1. Did you hire enough employees in 2015 or 2016 to make you eligible for the Affordable Care Act? The rules state if you have an average of 50 or more full time and full time equivalent (FTE) employees throughout the prior calendar year, you are subject to the Employer Mandate rules of the ACA. This requires offering appropriate health coverage to your employees and reporting on that coverage to the IRS.
  2. Are you providing health insurance coverage to at least 95% of your workforce? The 95% rule is an increase from the 2015 requirement of 70%. This greatly increases the chances of missing an employee due to an administrative error resulting in a penalty.
  3. If you have more than 50 FTE’s, you are required to report your coverage offered (or lack thereof) to your employees and the IRS on the Form 1095-C and 1094-C. If you do not report, you are subject to additional fees on top of any applicable penalties for not offering coverage.
  4. Penalties for not offering coverage or for not reporting coverage to the IRS have increased for 2016 and will continue to increase each year.
  5. If you are approaching the 50 FTE mark, have you considered if your health plan is affordable or if it offers minimum value or minimum essential coverage as defined by the Affordable Care Act?

While your broker may be able to answer some of these questions, they are often not equipped to help you with the associated IRS reporting. Who will you turn to for help with Affordable Care Act compliance?

Tandem HR is a Professional Employer Organization (PEO) in the Chicagoland area that assists hundreds of small and mid-sized businesses with Affordable Care Act compliance. They also help clients save time and money while growing their business by taking on the administrative tasks associated with human resources, benefits, payroll, tax administration, regulatory compliance and risk management.

For more information on Tandem HR or PEOs, visit or call 630.928.0510.