The Affordable Care Act (ObamaCare) is raising all kinds of questions for payroll departments as well as tax professionals. Regulations continue to be defined and revised as the program develops. And the IRS recently announced that since they have cut back on staff, if you call them regarding questions concerning the program that they are charged with administrating, chances are they are not going to be able to allocate the resources to answer your questions.

We recently received a call from a client who provides health ins for their employees. They have less then 250 W-2’d employees so that were not required to indicate on their W-2’s the health insurance provided . They were concerned because one of their employees went to a national firm to file their taxes and was told that since there is no indication on their W-2 of health insurance provided, they were going to automatically add the penalty to the individual’s return. This is incorrect action on the part of the that tax firm’s counselor.

If the employee worked for a firm that had 250 W-2’d employees, there would be indication on all that firm’s employees W-2’s of health insurance provided by the employer. If the employee worked for a firm with less than 250 W-2’d employees, it will be up to the employee to indicate upon filing their taxes if they had employer provided health insurance. It is a simple Yes or No question.  That is all that is required. It is up to the individual to be truthful, and then up to the IRS to verify health insurance coverage. (There is a penalty for misrepresenting your health insurance coverage.)

As the program develops. individuals are becoming more aware of the ACA and  its requirements. This is the first year that the ACA’s penalty for not having any health insurance coverage kicks in. The penalty is $95 or 1% of adjusted gross income up to a certain limit. The penalty is scheduled to increase every year for the next few years. This is to encourage everybody to get health insurance coverage and thus fund the government sanctioned program. The Advi$or suspects that if Obamacare was not very popular in previous years, it’s popularity may decline further as individuals become more aware of the ACA’s required penalty system.

 

About Time & Pay:

Time & Pay is a professional payroll service provider located in Johnson City, TN. We service businesses of all sizes and types throughout the United States. Founded in 1992, Time & Pay provides businesses with complete payroll services , guaranteed payroll tax compliance, automated time and attendance systems and services, pay-as-you-go worker’s comphuman resource management systems and services, and more. We provide our customers with the cost effective tools you need to better manage your payroll, your employees and your business. Time & Pay’s services guarantee you will save money, time and aggravation and we back them up with the customer service you expect and deserve. Contact Us today to learn why business owners throughout the country are saying:

“Time & Pay! Why would you do payroll and timekeeping any other way?”

Offices:
Payroll Services  in Kingsport, Bristol, Johnson City, TN   423-854-9042
Payroll Services in  Morristown, Greenville, Knoxville, TN   423-957-9505
Payroll Services in Cleveland, Chattanooga, TN  423-794-7855
Payroll Services in Newport News, VA   757-240-2766