ACA Trumped - Part 2 Webinar Q&A
Recently, I gave an important status update on the ACA during an Assurance University webinar. The webinar brought up a lot of great questions, and we’re answering a few below.
1. Can the President, either through Executive Order or by directing the Treasury Secretary, "suspend" or otherwise not enforce/collect ACA taxes (basically not enforce the employer and/or employee mandates)?
The President can attempt to minimize the process, but simply refusing to enforce the law would be a dramatic step. There are certain tax rules where the IRS takes a "non-enforcement" stance on, but those are usually on proposed rules or ones that are subject to upcoming significant changes. The employer mandate rules and the associated penalties don't fall into that category.
2. Will employers be subject to penalties for Marketplace Notices?
There are no mandated penalties for failure to distribute Marketplace Notices. However, failure to comply with this rule could result in an employee forgoing a subsidy they were entitled to, and that can result in private actions against an employer. Further, in an audit, the DOL would require the employer to distribute the notices and could take further action if they deem the employer failed in its duties willfully.
3. Will tax reform be done via budget reconciliation? If so, wouldn't that mean ACA repeal/replace is off the table via budget reconciliation? When would the next opportunity be to do a budget reconciliation bill?
Both the Republican ACA Repeal and Replace efforts, and overhaul of the tax code, will be done via budget reconciliation. In order to do so, they only need a simple majority vote in the Senate.
4. Do employers have to perform any solicitations for name errors on 1095-C forms?
Employers are required to solicit the correct spelling of the names of all enrolled individuals and their tax IDs a total of three times. If you haven't done that yet, and received a name/SSN mismatch error on one or more of your 1095-Cs, you'll need to begin this process for those employees with the mismatch.
5. Do you anticipate the, as of yet not addressed, non-discriminatory issue to be addressed in 2017?
We do not know the timing of the new non-discrimination rules. We don't anticipate these being released in 2017.
Information contained herein is not intended to constitute tax or legal advice and should not be used for purposes of evading or avoiding otherwise applicable regulatory responsibilities as issued by the federal or state government(s) and/or taxes owed under the Internal Revenue Code. You are encouraged to seek advice from your legal or tax advisor based on your circumstances.
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