While the Affordable Care Act is certainly affecting the healthcare industry, did you know that it will have a significant impact on accounting as well? As an accounting professional, it is important that you are knowledgeable about these changes and their implications. Here are some things you should be aware of regarding taxes and the ACA.
- Individuals and families. For the first time, healthcare will need to be reported on annual taxes. The individual shared responsibility provision requires that each member of the family have qualifying health insurance or an exemption. For individuals and their family members who have had health insurance throughout the entire year, there is a box to check on the tax return form without any further action. If healthcare insurance was acquired through the new Marketplace, you may be eligible for a premium tax credit.
- Large and small employers. The tax implications of the ACA for employers largely depend on the size of the company. Employers with fewer than 25 full-time employees may qualify for the small business healthcare tax credit which can help cover the cost of providing coverage. Large employers (over 50 employees) may have to pay an assessment if it does not offer affordable insurance. All employers, regardless of their size, who provide self-insured health coverage to employees will need to file an annual return reporting this information.
- Insurance providers. Any entity that provides minimal essential coverage must report this to the IRS. These returns must also be filed electronically depending on the number of information returns that need to be processed. This information is then used by the IRS to determine how long individuals have been covered.
- Tax preparers. For tax professionals, it is important to know what your clients are required to provide to ensure they are compliant with the new ACA coverage requirements. They should understand the minimum essential requirements and have proof of insurance. Some clients may need to make an individual shared responsibility payment. For business clients, it is important to know which category they fall into regarding small or large employer.
Do you want to know more about the ACA and accounting? NRI Staffing Agencies in Washington DC can help today!