IRS Letter 227-L is issued to employers as a follow-up to previous communications regarding the Affordable Care Act (ACA) compliance. This letter signifies a revised calculation of the Employer Shared Responsibility Payment (ESRP) after the employer has submitted additional information or contested an initial assessment.
Understanding the Revisions in Letter 227-L
Letter 227-L provides a new calculation of potential penalties based on the employer’s response to Letter 226-J. It offers employers a chance to review and understand the updated assessment before it becomes final.
Steps to Take After Receiving Letter 227-L
Upon receipt of Letter 227-L, employers should:
- Thoroughly review the revised penalty details provided by the IRS.
- Consult with tax professionals or legal advisors to understand the implications of the new assessment.
- Prepare to either accept the revised penalty and arrange for payment or continue contesting it through further communication with the IRS.
Strategies for Managing ACA Compliance
Proactive management of ACA compliance can prevent issues that might lead to penalties. Employers are encouraged to:
- Regularly audit their ACA reporting and tracking systems.
- Use compliance software like ACA-Track to ensure accuracy and timeliness of data.
- Stay informed about updates and changes in ACA regulations that may affect reporting requirements.
To gain more insights on managing ACA compliance effectively and avoiding potential penalties, consider exploring the services and tools available at ACA-Track.
