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Advice for Applicable Large Employers (ALE)

Tuesday, January 12, 2016

The Internal Revenue Service had revealed some key tips that Applicable Large Employees need to know about tax-related reporting requirements and health care coverage offers.  Applicable Large Employers are required by the Affordable Care Act to file tax returns along with supporting documents and other information. Applicable Large Employers are defined as organizations with more than 50 full-time staff. It turns out many organizations are not considered Applicable Large Employers and they would not be subject to this type of provision. Those who are required to follow this provision will need to complete and submit Form 1094-C and Form 1095-C to report information about health care coverage and health care coverage enrollment for employees.


The IRS wants Applicable Large Employers to know the following information about what is required of them in 2016.


The Form 1095-C will be required for providing full-time employee information during the calendar year and to submit this to the IRS. Also, Form 1094-C is required by the IRS for reporting each employer’s summary information. Applicable Large Employers need to file one Form 1095-C per full-time employee.


If a business offers its employees self-insured coverage, then Form 1095-C is required to provide the IRS with relevant health care information about each employee that has minimum coverage through the health care plan that the employer provides. The IRS uses Form 1094-C and Form 1095-C to verify if the employer will owe any money to the IRS for shared responsibility provisions, as well as to determine the employer’s eligibility for the premium tax credit.


An Applicable Large Employers can fulfill their obligations if they file their required forms or a substitute form. However, if a substitute form is used, it should include what the IRS specifies on the official1094-C and 1095-C requirement forms. The 1094-C and 1095-C Forms, or a substitute if an employer chooses to use it, needs to be filed, no questions asked. This is a filing requirement of any Applicable Large Employers who offers health care coverage for their employees.


The Strategic Tax Lawyers, LLP are a firm of tax professionals and professional tax attorneys in Los Angeles.  We, at the Strategic Tax Lawyers Firm, are experts in tax code with decades of successful experience dealing with the IRS and settling tax-related cases for our clients.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.