Big ACA tax bills catch some smaller employers by surprise
These
One group of employers thought they had fully complied with the Affordable Care Act's so-called employer mandate to provide health insurance. A letter and six-figure bill from the
Some employers had expected to some day get asked to come up with a payment for not fully complying, based on their reporting to the
The third reason for reacting with surprise is that some business owners and executives just can't believe the
The ACA, of course, remains the law. So while assuming it wouldn't be enforced seems to be a case of stepping on your own garden rake, there have been repeal efforts, court cases and an administration executive order repeatedly fired at the ACA. You can't really blame a few business owners for being a little confused about it.
As for how widespread the problem is for regional employers, it's "a huge deal for a small number of employers," according to
Radecki helps insurance brokers and their clients understand the rules on employee benefits, and he said this was another clear example of how following the rules turned out to be just another set of tasks for big companies while small and medium-size employers really struggled.
Big companies have sophisticated human resources technology, along with in-house expertise and top legal and accounting experts a phone call away. Compliance wasn't free, of course, but it hasn't created the kind of problem that reaches the office of the CEO.
"But the 100-, 200- or 300-life employers, a lot of them just face-planted on the reporting" for 2015, Radecki said. "Now the
A client with a six-figure problem told Radecki she hadn't cried so much since her husband died.
Employers were given this obligation to provide insurance or pay up because
Of course,
So far so good, if the employer found a way to fulfill the mandate. But then the employer still had to send detailed information to the
"It was difficult, extremely difficult," said
Because 2015 was the first year, there were additional rules lumped under the general heading of "transition relief," helpful for some employers but adding still more complexity for a layman just trying to figure it out.
The notices that are now arriving from the
A common problem now showing up is that employers reported their number of full-time employees using a different definition than the
Krieg said he has advised clients holding an
"In the case of one of our clients they got an assessment of over
Another message from the consultants is a reminder that the law is still the law. Once problems from 2015 get cleaned up the notices for 2016 problems may start arriving. And by now, the time until the first reporting deadline for 2017 is best measured in weeks, not months.
"A lot of people are surprised that the
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