2024 ACA Electronic Reporting Requirements

Changes for 2024

As 2024 approaches, employers should be aware of the upcoming Affordable Care Act (ACA) reporting changes on the horizon. Since 2015, the standard that employers have been able to rely on when filing their Forms 1094-C and 1095-C was that they could do so by paper rather than electronically if they were filing less than 250 returns. However, beginning in 2024, employers that file 10 or more returns will now be required to file electronically. This change in reporting methodology will be first applicable to the 2023 reporting year.

The new reporting rules are detailed in full here.

In addition to reducing the 250-return threshold to 10 or more, the final regulations specify that filers will be required to aggregate the various types of information returns covered by the regulations, which includes Forms W-2, 1099, along with certain tax returns, in addition to Forms 1094-C and 1095-C. Previous regulations applied the 250-return threshold more broadly, allowing filers to consider each individual type of information return separately rather than as an aggregate, eliminating the need for many entities to file electronically. That is no longer the case. Once aggregated together, a determination regarding the necessity to e-file will be made if an employer has at least 10 returns.

Who Is Generally Required to File?

• Applicable Large Employers (ALEs) --- employers that employed an average of at least 50 full-time employees, including full-time equivalent employees, during the previous calendar year.
  • This may include employers that are part of an aggregated ALE group due to significant common ownership or control stemming from related employer entities.
• Small employers that do not meet the definition of an ALE (and that are not part of an aggregated ALE group) must report participant coverage information to the IRS if they sponsor a self-funded (or level-funded) plan.
  • Small employers that offer only fully insured plans, or no coverage at all, are not subject to the reporting requirements.

Employers that have never gone through the electronic filing process will need to ensure that they are properly registered with the IRS for e-filing. The IRS has provided an application tutorial detailing the steps involved with completing the necessary forms to begin e-filing. Due to some of the inherent complexity associated with e-filing via the IRS’ Affordable Care Act Information Returns (AIR) system, it is highly recommended that employers engage an experienced vendor.

When Is the Filing Due?

Reporting is due annually and is based on the preceding calendar year. For paper filings, which will now largely be eliminated as a result of the new guidance, the deadline to mail the appropriate information to the IRS is February 28^th. For e-filings, employers will have until the last day of March. In 2024, those filing deadline dates will be February 28^th and April 1^st (since March 31^st falls on a Sunday) for paper and electronic filing, respectively, and will cover the 2023 calendar year.

Are There Any Exemptions Available?

The final regulations continue to allow for “hardship waivers” in certain, limited instances. As per the regulations, small entities that would experience a financial hardship due to the rule are able to seek a hardship waiver. Beyond hardship waivers, which must be deemed “meritorious”, the regulations note an exception for religious communities for whom the use of technology that would be required to e-file would conflict with their religious beliefs.

How Can AssuredPartners Help?

Our ACA 1094/1095 Reporting Team (AssuredAnswers) stands ready to assist clients utilizing AssuredAnswers' services with any potential filing needs and related questions. Please contact them at assuredanswers@assuredpartners.com for help with your ACA reporting matters and e-filing support.

Additional Links:

• Electronic-Filing Requirements for Specified Returns and Other Documents (IRS)
• ACA Information Center for Applicable Large Employers (ALEs)
• Affordable Care Act Information Returns (AIR) system
• IRS Application Tutorial
• IRS Reporting Rules
• Draft Tax Forms