IRS Code 1094C-023 is triggered when there are discrepancies in the employee count reported on Form 1094-C. Accurate employee count is crucial for determining an employer’s obligations under the Affordable Care Act (ACA).
Importance of Accurate Employee Count Reporting
An accurate count of full-time employees and full-time equivalent employees is essential for:
- Determining whether an employer is subject to the employer mandate.
- Calculating potential penalties for non-compliance with coverage requirements.
- Ensuring correct data submission to the IRS for compliance purposes.
Common Causes of Employee Count Discrepancies
Discrepancies in employee counts can arise from:
- Errors in data aggregation from multiple sources or payroll systems.
- Misclassification of employees between full-time and part-time statuses.
- Lack of updating employee status changes in reporting systems.
Steps to Correct Employee Count Discrepancies
To address and correct issues flagged by Code 1094C-023, employers should:
- Conduct a thorough review of all employee records to verify the accuracy of the count.
- Update any incorrect information in the ACA reporting tools and systems.
- Amend the Form 1094-C with the corrected employee count and resubmit to the IRS.
Tools and Resources for Accuracy
Employers can enhance their compliance efforts using tools like ACA-Track, which helps manage employee data accurately. For additional assistance:
- The Official IRS website offers comprehensive guidelines on reporting requirements and how to correct discrepancies.
- The Common 1094-C error codes page provides further insights into common issues and corrective actions.
