Some employers are receiving notices from the IRS informing them of penalties under the Affordable Care Act. These letters (about 300,000 have been sent) indicate that the employer violated the ACA’s employer mandate. The IRS has been issuing letters for 2015 and 2016 compliance years.
An employer who receives an IRS letter should review it carefully and respond timely. The letters identify “proposed” penalties and an employer receiving a letter may challenge its validity. The employer should be sure to review IRS calculations, check their own records to determine if the data the IRS has is accurate, and compare the Form 1094/1095 for any noted employee with the plan’s data.
It is suggested to send a detailed response to the IRS indicating any erroneous information. New 1095 forms do not have to be distributed to employees, but the IRS should be made aware of any changes to previously provided information.
