Do you have employees working in the following states: California, the District of Columbia, New Jersey, Rhode Island or Vermont? - Bim Group

Do you have employees working in the following states: California, the District of Columbia, New Jersey, Rhode Island or Vermont?

( 2 MINUTE READ )

If so, please continue reading.

Employers with operations in states who are Applicable Large Employers (ALE) (companies with 50 or more employees) have an  additional state level ACA reporting requirement as part of the state’s Individual Mandate.

The Individual Mandate requires individuals to purchase qualifying health coverage or pay a tax penalty unless they qualify for an exemption. The Mandate encourages residents who might otherwise not buy health insurance to do so in order for health insurance to be more evenly spread amongst the pool of covered individuals, and not just the sick. Employers too have a part to play under the statewide Individual Mandate. Currently California, Massachusetts, New Jersey, Rhode Island, Vermont, and the District of Columbia have Individual Mandates in place and require employers to report their ACA information on a state level.

If you have employees working in these states, please contact your ACA reporting provider to see if they can assist with state level reporting.

New Jersey

ALE will use IRS forms 1094-C and 1095-C, (1095-B, and 1094-B if self-insured) to communicate health insurance information to the state, in addition to their federal responsibilities for annually furnishing these forms to full-time employees and to the IRS. The deadline is March 31 of the following reporting year.

California

For the 2020 tax year, self-funded employers in California will need to report on the employees that had health coverage throughout the year. The information must be furnished to employees by January 31, 2021 and filed with California’s Franchise Tax Board by March 31, 2021.

Washington DC

In DC, every “applicable entity that provides Minimum Essential Coverage to an individual during a calendar year” is required to submit an information return regarding such coverage to the Office of Tax and Revenue (OTR).

It also requires the applicable entity to submit a statement about the individual’s type of coverage.

These filing requirements, while similar to Federal filing requirements under the ACA, are not the same. All information returns are required by OTR to be filed electronically through MyTaxDC, as paper filings will not be accepted. The new tax guidance requirements for annual reports are due beginning June 30, 2020. For future reporting years, the deadline for employers to file is 30 days after the federal IRS filing deadline.

Massachusetts

Massachusetts’s mandate has been in place since 2006. Employers do not have to report employee-level details to the state. The reporting is generally done by insurance carriers on behalf of individual employers. Employers must file by December 15th of the reporting year, much earlier than the federal filing deadline.

Vermont

Currently, there are no additional ACA reporting requirements for employers. Employers will have new coverage reporting obligations to the state only if the federal ACA reporting requirements are eliminated.

Rhode Island

Rhode Island’s individual penalty went into effect in January 2020. At this time, the only additional reporting requirements employers will need to comply with are the furnishing of healthcare receipts to employees beginning January 2021. The state has not disclosed whether the furnishing of health statements will be on the standard 1095-C or through a similar document. Employers with operations in Rhode Island should watch closely for updates.

 

Adapted from https://acatimes.com/aca-reporting-to-grow-in-complexity-due-to-state-individual-mandates/

Recent Insights

January 23, 2025
News

Rising ERISA Class-Action Lawsuits over Tobacco Surcharges in Health Plans

READ TIME: 5 MINUTES A wave of ERISA class-action lawsuits is challenging tobacco surcharge programs in employer-sponsored health plans across the U.S. These cases center on potential fiduciary breaches, with plaintiffs arguing that surcharges added to tobacco users’ premiums are not compliant with federal laws such as the Employee Retirement Income Security Act (ERISA), the […]
Read more
January 10, 2025
Affordable Care Act (PPACA)

ACA Reporting Changes for 2025

On December 23, 2024, President Biden signed into law the Paperwork Burden Reduction Act (PBRA) alleviating some burdens associated with the annual ACA reporting.  Effective for tax years beyond 2023, employers are no longer required to automatically distribute the Forms 1095-B/Cs to employees unless requested.  The Form 1095-B/Cs must still be prepared and electronically filed […]
Read more
January 7, 2025
News

Webinar: Ensuring Your Health Plan is Ready for a Department of Labor Audit

Tuesday, January 14, 2025 1 – 2PM CST Register Now Registration Code:UBA410EW Attend this month’s webinar to learn what triggers a DOL audit and how to prepare. Key takeaways:  Gain insight into the DOL’s enforcement priorities that can trigger an audit, especially regarding compliance with the ACA, Mental Health Parity and Addiction Equity Act, and […]
Read more
January 7, 2025
News

Wellness Programs and Smokers’ Penalties under Scrutiny

READ TIME: 5 MINUTES A recent lawsuit involving Macy’s Inc. and the U.S. Department of Labor (DOL) is bringing attention to the way companies structure their wellness programs—particularly those that impose penalties on employees who smoke. This case highlights the potential risks for employers who charge higher health premiums to smokers and raises questions about […]
Read more