The IRS won’t reject taxpayers’ 2016 income tax returns with missing healthcare information, but employers this year will be held to the same Obamacare reporting rules as last year.
The IRS’ decision applies only to personal income tax filing. Also, penalties for noncompliance are still in place and will be enforced.
The IRS move came after President Donald J. Trump signed an executive order giving the Department of Health and Human Services and “other executive departments and agencies” the authority and discretion to roll back certain aspects of the Affordable Care Act.
Under the ACA, Americans have been required to demonstrate they have “essential minimum coverage” by filing a form with their tax return.
For the 2016 tax year, the penalty for those who fail to do so would have been equal to 2.5% of adjusted gross income (AGI), or $695 per adult and $347.50 per child, up to a maximum of $2,085, whichever is higher.
It’s unclear whether the IRS will enforce the mandate next year or whether the agency is holding out for the ACA’s possible repeal or reform.
Employers should continue meeting their tax obligations under the ACA until they’re told otherwise. They still must send employees Form 1095-C and submit Forms 1094 and 1095 to the IRS.
The health law might not change until 2018. The president and Republican lawmakers are still considering their repeal and replace plan.
About the Author
Lon is the former publisher of the Colorado Springs Business Journal and Colorado Springs Military Newspaper Group.He has served in leadership roles at various newspapers in Iowa, Florida and Wisconsin. Lon received his Bachelor of Arts in Communications from the University of Wisconsin, Eau Claire and attended the Kellogg Graduate School of Management at Northwestern University. Earlier in his career, Lon spent several years as a sea captain and held a 100-ton Coast Guard license. Lon is a former rugby player, referee and administrator and now coaches under 13 year old kids. Lon has served on the boards of numerous community and business organizations including Colorado Springs Leadership Institute, Peak Venture Group, CS Quality of Life Indicators Business Index Committee, Junior Achievement and is a member of The Colorado Thirty Group. Lon was given the “Making the Pikes Peak region a better place to live work and play” award by the CS Chamber of Commerce, was the VFW Post 1’s business citizen of the year.