Taxpayer Advocate Service has self-help tools to assist employers with complex ACA requirements

The Taxpayer Advocate Service has announced that they have recently developed a tool to help employers understand how the provisions of the employer shared responsibility provision (ESRP) under Code Sec. 4980H apply to their organization. The ESRP applies to applicable large employers (ALEs) – generally, that means employers that had an average of at least 50 full-time employees (including full-time equivalent employees – FTEs), during the preceding calendar year.
The National Taxpayer Advocate is appointed by the Secretary of the Treasury and reports to the Commissioner of Internal Revenue, but does not necessarily reflect the position of the IRS, the Treasury Department, or the Office of Management and Budget. Employers can use the ESRP Estimator to determine:

  • The number of the organization’s full-time employees, including FTEs,
  • Whether the organization might be an ALE, and
  • If the organization is an ALE, an estimate of the maximum amount of the potential liability for the ESRP that could apply to it based on the number of FTEs that it reports if it fails to offer coverage to its full-time employees.

The estimator will not report a payment estimate to the IRS or interact with the employer’s tax return or tax account information. It is intended only as a guide to help employers understand the ESRP. Employers will not report or include an ESRP payment with any tax return or information return they may file. Instead, based on information from the organization’s tax return and from its employees’ tax returns, the IRS will calculate the potential ESRP payment and contact the employer to inform it of any potential liability. The employer will then have an opportunity to respond before any assessment or notice and demand for payment is made.
This estimator is designed only for 2016 and forward. For 2015, transition rules are applied in determining the payment.

SOURCE: NTA Blog: Affordable Care Act Estimators, October 18, 2018
Visit our News Library to read more news stories.