Delays in implementing the Affordable Care Act (ACA) are over, and businesses must now be sure they are in compliance with the ACA’s requirements. The ACA has the greatest impact on “Applicable Large Employers,” generally defined as those companies who employ 50 or more full-time employees (or full-time equivalents). If your business falls into this category, here are five of the most important ACA provisions you should know about – and be taking action on. Starting this year, large employers must provide the Internal Revenue Service (IRS) information returns detailing whether they offered health care insurance and, if they did, what the coverage entailed.

1. Annual reporting. Starting this year, large employers must provide the Internal Revenue Service (IRS) and the company’s employees with information returns detailing whether they offered health care insurance and, if they did, what the coverage entailed.
2. Self-Insurance reporting. If you provide self-insured health coverage for your employees, you must still file an annual report with the IRS detailing certain information for each employee who is covered.
3. Minimum essential coverage. Large employers have a choice: Provide full-time employees (and their dependents, although the employer does not have to pick up the additional cost) with a health plan that provides “minimal essential coverage” and is affordable; or make an employer shared responsibility payment to the IRS. Minimal essential coverage is defined as a plan that covers “at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan.”
4. W-2 reporting. Large employers may be required to report the value of the health insurance they provide on each covered employee’s W-2 form.
5. Exactly 50 employees? If you are just at the minimum size to qualify as an Applicable Large Employer, you can purchase affordable insurance coverage for your employees through the Small Business Health Options Program (SHOP). But if you add a new employee this year, better review the provisions listed above before 2017 arrives!

Reporting and accounting requirements of the Affordable Care Act can be complex and confusing, and you should be seeking advice from qualified experts. If you have questions about the ACA or other tax questions, please contact Gray, Gray & Gray’s Tax Department at (781) 407-0300.