Non-profits Not Exempt from ACA Reporting
Does your non-profit need to report health care coverage? Depending on your size, yes. The IRS requires all applicable large employers (ALE’s) to file health coverage information returns each year.
In addition, ALE’s must provide all employees who worked full time for at least one month of the year with a statement about the health insurance it did or did not offer. No ALE’s are exempt from this obligation—whether you’re governmental, tribal, non-profit, or for-profit.
Your first question may be, “Is my non-profit an ALE?” An ALE employs 50 or more full-time—or full-time equivalent (FTE)—employees. Any staff member who works 30 or more hours in a week is considered full-time.
To determine your number of FTE staff, add the monthly hours of everyone who works FEWER than 30 hours a week. Then, divide those total hours by 120. (Remember: employees working 120 hours per month or more are considered full time, so don’t include them in this calculation.)
Confused? Here’s an example:
- Employee A works 15 hours per week (=60 hours per month)
- Employee B works 10 hours per week (=40 hours per month)
- Employee C works 20 hours per week (=80 hours per month)
Total the hours per month (60+40+80 = 180) and divide by 120 (180/120 = 1.5). Employees A, B and C equal 1.5 FTE staff. Add this number to your actual full-time staff to conclude whether you employ 50 or more.
If you determine you are an ALE, what forms do you need?
- Form 1094-C is used to report summary information to the IRS and must accompany the Forms 1095-C.
- Form 1095-C has two purposes:
- To report required information to your employees, and
- To report information about each employee to the IRS.
You must provide Form 1095-C to your staff by February 1. The copies are due to the IRS (with Form 1094-C) by February 28 (or February 29 in a leap year) if you’re mailing them, or by March 31 if you’re filing electronically.
For the 2015 tax year (filed in 2016), the IRS has extended these deadlines:
- Provide Form 1095-C to your staff by March 31, 2016
- Mail Form 1094-C to the IRS by May 31, 2016, or
- File Form 1094-C electronically by June 30, 2016
Don’t count on these deadlines being extended in the future though!
Need help reporting your non-profit’s health care coverage correctly this year? Contact the Online Stewardship Accounting & Consulting team for assistance: Lynn@OnlineStewardship.com or (904) 398-4747.
