Staying on top of employee benefits eligibility using the required ACA methods is time-consuming and complex. Employers should already be collecting and managing data, such as hours worked, employee status, offers of coverage and more. With ACA Compliance added to your isolved HCM software, you can capture much of the data you need automatically, and automate key tasks at the end of employee measurement periods.
You need to be reviewing data now to determine eligibility, offers of coverage and affordability. The IRS will use the data on the forms you file to determine compliance with the employer-shared responsibility provisions, so having accurate data that’s readily available is critical.
Establish categories of employees for ACA purposes
Set standard measurement, administrative and stability periods for ongoing employees and initial measurement, as well as administrative and stability periods for new hires
Show current ACA status and applicable measurement, administrative and stability periods on each applicable employee record
Identify the measurement method (monthly or look-back) for each employee
Review status change reports highlighting ACA status changes based on measured hours of service category
Automate updates to employee records at each measurement period based on life events, ACA status and coverage stop dates.
A company that employs 50 or more full-time equivalent employees is defined as an Applicable Large Employer (ALE). The employer mandate requires all ALEs to offer minimum essential coverage that is both affordable and provides the minimum or face a penalty called the Assessable Payment (play or pay). This coverage must be offered to all full-time (FT, defined by total hours of service) employees and is determined by using either a monthly or look-back measurement period.
Employers that do not have a solution for collecting and managing the necessary employee and benefit data to satisfy Section 6055 and 6056 reporting requirements run a significant risk for incurring reporting penalties and ACA excise taxes.