Tax reporting under the Patient Protection and Affordable Care Act (ACA) represents the largest expansion of tax-reporting requirements since W-2s were introduced, according to DirectPath, a human resources (HR) adviser specializing in the health care industry. To help large employers navigate this regulatory wave, DirectPath partnered with compliance-reporting software firm Sovos to create a one-stop-shop for employers to meet their ACA-reporting needs for the 2016 tax year.
According to DirectPath, the new technology will allow employers to gather required data and create forms. The solution can also file forms on companies’ behalf, the firm says. Moreover, it will give employees access to a call center where professionals can answer their reporting questions.
DirectPath notes that “creating, distributing and filing the appropriate forms requires data from multiple sources and cannot be done with the same system that employers use to process W-2 forms.” Employers must also file these forms using their federal ID numbers; some companies have several of these. Additionally, the required reporting must be completed between December when the year’s information becomes available and January 31, 2017, the deadline for employees to receive their 1095 forms.
“In 2015, the first year of required ACA reporting, Sovos ACA [software] supported over 1,000 companies and provided services to 20 million households,” says Jeff Cronin, vice president of product strategy for ACA at Sovos Compliance. “The combination of DirectPath’s ACA compliance technology and benefits expertise with our IRS [Internal Revenue Service] filing infrastructure and experience will help more employers maintain compliance with ACA legislation and allow HR departments to focus on serving their employees.”
DirectPath and Sovos Compliance will host a joint webinar titled “ACA Reporting Best Practices—From Headache to ‘Ah-ha!,’” Tuesday, September 20, at 1 p.m. EDT. It will cover key takeaways from the first year of ACA reporting and transmittal to the IRS, along with considerations for the 2016 reporting process, DirectPath says. Those interested in attending can register online here.