IRS Code 1094C-041-02 is sent to employers who report an incorrect amount for the employee share of the lowest cost monthly premium. This figure is vital for assessing whether an employer’s health coverage is affordable under the Affordable Care Act (ACA).
Impact of Reporting Incorrect Premiums
Incorrect information about the employee share of premiums can lead to erroneous affordability assessments by the IRS, potentially resulting in penalties for non-compliance with ACA mandates.
How to Correct Incorrect Premium Reporting
- Review your health insurance coverage offerings and the calculations used to determine the employee share of the lowest cost monthly premium.
- Correct any errors found in the calculation or reporting and prepare an amended Form 1094-C.
- Submit the corrected information to the IRS to rectify the compliance record.
Preventing Future Errors
Ensuring accurate reporting in future ACA compliance efforts involves:
- Implementing stringent verification processes for calculating and reporting healthcare costs.
- Training HR and payroll teams on the nuances of ACA reporting requirements.
- Employing ACA compliance software to automate and validate data before submission.
Getting Additional Help
If you need further assistance with ACA reporting requirements or correcting filed information, explore ACA Track’s FAQ page or consult with ACA compliance experts.
