USA: Healthcare: Compliance Update: IRS Releases Long Awaited Guidance on Collection of Pay or Play Penalties

The US Internal Revenue Service (IRS) finally released information, in the form of Frequently Asked Questions, on the mechanics of how it will assess employer “Pay or Play” penalties under the Patient Protection and Affordable Care Act (ACA).

The FAQs both describe the penalty assessment process and confirm that employers should expect to receive assessments starting in late 2017. Importantly, the determination of whether an employer may be liable for Pay or Play penalties and penalty amounts are based largely on information reported to the IRS on Forms 1094-C and 1095-C. New details on the assessment process are discussed in Alliant’s full compliance report. Note, however, that some of the Forms and Letters mentioned in it as part of the assessment process are not yet available.

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