ACA Reporting For Applicable Large Employers

As required by the ACA, Applicable Large Employers need to do information reporting for their work time employees that are provided health coverage. An Applicable Large Employer or ALE is an entity or group of entities that employ at least 50 full-time employees including equivalent employees that work at least 30 hours a week.

There are two aspects of the Affordable Care Act (ACA) that apply to applicable large employers:

  1. The employer needs to share responsibility provision and the information reporting should account for offers of nominal coverage. Moreover, any ALEs that have their own self-insured group health plans and sponsor them, they need to possess provider requirements in terms of information reporting.
  2. If employers had full time 50 working employees last year, they will be considered an ALE, which requires them to settle on their ALE status by just looking at their workforce numbers the previous year.

Calculate Number of Employees

An ALE is described as any employers having 50 full time working employees but the status can be determined through a calculation as well. The number of employees that worked full time (or full-time equivalent) is the measure that works in determining the status of an ALE. Remember, the IRS considers 30 hours a week (or 130 hours a month) full time.

The Necessity of Covering Employees

Every ALE must provide health coverage to certain employees based on the minimum essential coverage. If it fails to do so, then it will need to pay the penalty under Section 4980H or also known as “shared responsibility payment”.

The monetary amount of the penalty depends upon things like number of employees and months of penalty. 

Documents of Health Coverage for ALEs

Every ALE is required by the law to send copies of Internal Revenue Service Form 1095-C to its full-time employees. The form will enlist information about health coverage like the cost and months it was given to the employee. If the ALE chose not to provide any insurance, then Form 1095-C will state that too. Every ALE is required to provide the information on these forms to the IRS.

Getting Help with ACA Reporting

Looking for experts to help simplify the ACA Reporting process for you? Consider ACA Reporter for your filing needs this year. Contact us to learn more!