IRS Affordable Care Act Audits
Experienced Legal Counsel for Employers Facing Affordable Care Act Audits from the IRS
While the Affordable Care Act is supposed to help ensure that workers have access to health insurance, the statute’s requirements create onerous burdens for employers. Simply complying with the statute’s recordkeeping and reporting requirements can prove challenging (and costly), and noncompliance with these requirements can expose employers to substantial penalties—even if they otherwise meet the “employer mandate” for providing access to coverage. As a result Internal Revenue Service (IRS) Affordable Care Act audits often present substantial risks, and employers targeted in these audits must work with experienced counsel to defend themselves effectively.
New York Lawyers Representing Employers in IRS Affordable Care Act Audits
At Thorn Law Group, we have extensive experience representing employers in IRS audits under the Affordable Care Act. If your company is facing an IRS Affordable Care Act audit in New York, our lawyers can help ensure that you are ready, and we can help you proactively address any compliance-related concerns. When faced with the potential consequences of noncompliance, a proactive approach is best, and showing the IRS that your company is working diligently to address past mistakes can substantially mitigate the risks involved.
Of course, if your company is in full compliance with the Affordable Care Act, an IRS audit should not lead to any adverse consequences. But, even in this scenario, your company may still need to affirmatively demonstrate compliance in order to avoid penalties. While IRS audits can be extremely thorough, revenue agents typically err on the side of assuming noncompliance, and this means that it is often up to employers to show that penalization is unwarranted.
Understanding the Risks of an IRS Affordable Care Act Audit
The IRS has the authority to directly impose civil monetary penalties for several forms of noncompliance under the Affordable Care Act. Depending on the circumstances at hand, Affordable Care Act audits can potentially result in the imposition of multiple penalties—with many penalties applying on a per-employee basis. As a result, it is not unusual for employers to face substantial aggregate liability exposure. Potential penalties resulting from IRS Affordable Care Act audits include (but are not limited to):
- Section 4980(H)(a) Penalties –As of 2024, these penalties are $247.50 per month per employee.
- Section 4980(H)(b) Penalties – As of 2024, these penalties are $372 per month per employee.
- Failure to File Penalty – Failure to file information returns under the Affordable Care Act carries a penalty of either $310 or $630 per return (per employee) as of 2024.
- Failure to Furnish Penalty – Employers that fail to furnish 1095-C statements to their employees can face an additional penalty of $310 or $630 per statement (per employee) as of 2024.
Discuss Your Company’s Affordable Care Act Audit with a Lawyer at Thorn Law Group
If your company is facing an IRS Affordable Care Act audit in New York, we encourage you to contact us promptly for more information. To schedule a confidential consultation with a lawyer at Thorn Law Group, please call (914) 534-6004 or tell us how we can get in touch online today.
