New ACA Reporting Changes in 2025: What Employers Need to Know
February 6, 2025
New Changes to ACA Reporting Requirements Offer Welcome Relief to Employers
The Affordable Care Act (ACA) is streamlining employer reporting requirements starting in 2025, which is bound to ease the burden on many businesses.
Simplified Form 1095 Distribution
From the 2024 reporting year, employers aren't obliged to send Form 1095-C to all full-time employees. They only need to provide these forms upon request. To comply with this new rule, employers must:
- Post a notice of availability that is clear, conspicuous, and accessible.
- Distribute the form within 30 days of an employee's request, or by January 31 if later.
- Offer electronic distribution, provided the employee consents (valid until withdrawn in writing).
Despite this change, it's crucial to keep preparing and filing Forms 1095-C and 1095-B with the IRS annually, alongside the Form 1094-C/1094-B transmittal form, typically due by March 31.
Options for filing include services like EASE, Employee Navigator, or your payroll company. Ease charges $5 per qualified employee, and Tax Bandits is another budget-friendly option.
Extended Response Time for ACA Penalty Letters
The response window for Letter 226J, which concerns employer shared responsibility payments under Section 4980H, is being extended to 90 days. This timeframe starts for taxable years beginning after December 23, 2024. The extension offers employers more opportunity to adequately address and review the issues raised, especially when employees opt for the Marketplace over employer plans due to income considerations.
New 6-Year Statute of Limitations for ACA Penalties
A 6-year statute of limitations will now apply to the IRS’s assessment of ACA penalties. Effective for returns due after December 31, 2024, this limit begins on the return's due date or the filing date, whichever is later. This change replaces the previous lack of a statute of limitations.
For many business owners, bringing independent contractors on board is a practical choice that brings flexibility and specialized skills. However, it's crucial to understand the liability risks associated with using such workers. A common misconception is that a General Liability (GL) policy offers blanket coverage, but the truth is far more complex. It's essential to recognize the potential risks if contractors don't have their own insurance coverage.
In today’s uncertain world, financial planning is not just a smart move—it’s essential for protecting your loved ones. One of the key components of a strong financial plan is choosing the right insurance policy. For many, this decision boils down to a choice between life insurance and Accidental Death and Dismemberment (AD&D) insurance, two options that can be confusing at first glance. In this blog, we’ll break down the key differences to help you make an informed choice.
Summer travel season is just around the corner, with enticing destinations calling us away from our daily routines into the embrace of exploration and relaxation. Whether you're gearing up for a sun-soaked beach escape, a thrilling mountain adventure, or a culturally rich city break, one aspect of your travel checklist deserves more attention than it often gets: travel insurance. This essential safety net ensures that even with the most passionate planning, your dream vacation can be protected against unexpected curves the journey may throw your way.
Have you ever meant to purchase life insurance but found yourself putting it off time and again? You're not alone. It's a common scenario, full of good intentions yet stalled by various hurdles along the way. Many of us have experienced this delay, and it's important to understand that the hesitation often stems from something deeper than mere procrastination or neglect.
Our daily existence is becoming digitally integrated at an unprecedented pace, making cybersecurity a paramount concern. From online shopping and social networking to managing smart homes, our personal and financial information is more exposed than ever. High-profile incidents, such as the Grubhub data breach and PlayStation Network hacks, highlight the vulnerability of our digital lives. Despite this, many people believe their home insurance covers cyber risks, which is often not the case. This is where cyber insurance becomes crucial.
Navigating the world of liability insurance can be daunting, especially when working with independent contractors. Many business owners mistakenly assume that their General Liability (GL) policy covers all potential risks associated with their independent contractors. However, the reality is more nuanced, and misunderstanding these risks can lead to significant exposure if contractors don't have their coverage.
Financial planning plays a crucial role in safeguarding the well-being of your loved ones. It's an essential step to ensure that, in unforeseen circumstances, your family remains secure. As part of this planning, understanding the nuances of various insurance options, such as life insurance and accidental death and dismemberment (AD&D) insurance, becomes imperative. Many people find these terms confusing, yet making an informed choice between them can significantly impact your financial safety net.
If you've ever thought about getting life insurance but never quite got around to it, you're not alone. Many people find themselves with the best intentions to secure their financial future, only to let the task linger just out of reach. It’s important to know that this hesitation isn't solely about procrastination or neglect—there's a deeper, shared experience at play here.
Efficiency and ConvenienceOnline registration offers participants the ability to manage their Flexible Spending Account (FSA) and Health Reimbursement Arrangement (HRA) accounts from virtually anywhere at any time. With just a few clicks on a computer or mobile device, users can handle all aspects of their accounts efficiently.Faster ProcessingTaking advantage of online access, participants can swiftly submit reimbursement claims or upload documents to verify debit card expenditures. This method minimizes delays and errors, allowing quicker access to reimbursements when funds are needed most.Accurate RecordkeepingThe online system ensures clear and accessible records of all contributions, reimbursements, and debit card transactions. With real-time tracking, participants can maintain well-organized records, aiding them in tax preparation and ensuring their accounts remain compliant.Enhanced SecurityOnline platforms implement advanced security measures to protect personal and financial information, offering a superior level of protection compared to the traditional paper-based submissions via fax or mail.Access to Additional ResourcesAn online platform typically includes helpful resources such as FAQs and live chat support, enhancing the participant experience and satisfaction with the FSA or HRA.Easy Account UpdatesParticipants can seamlessly update their demographic details, set up direct deposit for reimbursements, add dependents, or order additional debit cards for family members, ensuring their account information is always current.Embracing online registration simplifies the management of FSA and HRA accounts, providing users with peace of mind and greater flexibility.
Understanding Employee ReworkEmployers often face questions about whether they must compensate employees who voluntarily put in extra hours to fix their own mistakes. This issue frequently arises when an employee chooses to correct errors outside of regular working hours without explicit instructions from management.Legal Obligations Under Federal LawAccording to the Fair Labor Standards Act, if an employer permits or requires employees to work, the time is generally considered hours worked and must be compensated. Even if the work is not directly requested, if the employer benefits from it and is aware it is being done, it counts as hours worked. This is typically referred to as working off the clock.The Importance of Management OversightIf employees are correcting their own mistakes—referred to as "rework"—the time they spend on these tasks is considered hours worked and should be compensated. Employers are responsible for maintaining control, ensuring that unnecessary work is not being performed, and recognizing that time spent on rework should be compensated.Addressing Performance IssuesIn at-will employment settings, continuous errors that result in rework can be treated as a performance issue. Employers have the right to address these issues through disciplinary measures, which can include termination if necessary. It's crucial that employers apply performance policies consistently to prevent discrimination claims or perceptions of unfair treatment.
