The Affordable Care Act (ACA) created reporting requirements under Internal Revenue Code (Code) Sections 6055 and 6056. Under these rules, certain employers must provide information to the IRS about the health plan coverage they offer (or do not offer) to their employees.
Currently, any reporting entity that is required to file at least 250 individual statements under Sections 6055 or 6056 must file electronically. However, on Feb. 23, 2023, the IRS released a final rule implementing a law change by the Taxpayer First Act of 2019, which lowers the 250-return threshold for mandatory electronic reporting to 10 returns. This means most reporting entities will be required to complete their ACA reporting electronically starting in 2024.
This ACA Compliance Bulletin describes the process for reporting electronically under Sections 6055 and 6056.
MANDATORY ELECTRONIC FILING
CURRENT THRESHOLD
Under the current reporting rules, any reporting entity that is required to file at least 250 individual statements under Sections 6055 or 6056 must file electronically.
NEW, EXPANDED THRESHOLD
Reporting entities that file at least 10 returns during the calendar year must file their ACA returns electronically beginning in 2024.
ACTION STEPS
Employers that are subject to the ACA reporting rules should begin to explore options for filing ACA reporting returns electronically. For example, they may be able to work with a third-party vendor to complete the electronic filing.
Reporting entities that may be in a position to perform their own electronic reporting can review the IRS’ ACA Information Returns (AIR) Program main page for more information on the reporting standards for composing and successfully transmitting compliant submissions to the IRS.
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