Insights

In this episode, Suzanne Spradley and Chase Cannon discuss IRS Letter 226J—the IRS’s first wave of ACA employer mandate penalty notices. Chase and Suzanne review the important information outlined in Letter 226J, including the employer’s due date for a response, the proposed penalty amounts and instructions on responding to the proposed penalty. The two describe potential responses to the letters, including important information on documentation and recordkeeping that might help support an employer’s response. They also discuss the importance of reviewing IRS Forms 1094-C and 1095-C before filing them with the IRS, even where the employer has engaged a third-party vendor to assist in filing, as well as the difference in good faith penalty relief efforts for employer reporting and employer mandate penalties. The discussion concludes with some practical bits on recordkeeping and some NFP resources that may be helpful.