1099 Tax Software Blog

Yes.

We can print and mail any size order with complete security.  Here are the steps you would want to take to have us print and mail on your behalf:

1. Contact sales at (480) 460-9311.  Sales can process your order or provide an estimate of the cost. Sales will also provide an account number.  We have very competitive pricing.  Call anytime.
2. Rename your excel file the account number and upload using this sharefile link:https://nationalsoftware.sharefile.com/r/r4605c86ea294f758
3. We will import, convert to PDF and return to you passcode protected using the last 4 digits of the 1st employer EIN in the excel file.  You review and email back letting us know whether to print and mail or if you have changes.  Once the PDF is approved, we begin printing.

Duplex printing is a feature of some computer printers that lets you print on both sides of a sheet of paper automatically.

When you check this option in the 1095 software, the software prints Form 1095-C (or Form 1095-B) then the employer and employee’s mailing addresses on the next page.  If your printer can automatically print on both sides, then the mailing addresses will be printed on the back of each 1095-C (or 1095-B) form.  You can tri-fold and stuff in any #10 size, 2 window envelope and mail.

All American’s are required to have health insurance. And individuals not covered by health insurance may be subject to penalties. The mandate and penalty arise from the passage of the Affordable Care Act (ACA).

The IRS enforces the Affordable Care Act mandates and penalties. To enforce or confirm that an individual is insured the IRS created Forms 1095-A, Form 1095-B and 1095-C.

Form 1095-A is also called the Health Insurance Marketplace Statement. It is an information return sent by Healthcare.gov or a state marketplace to individuals who purchased their health insurance through HealthCare.gov. Form 1095-A provides the dates of coverage, the amounts you spent each month for the coverage, who in your household was covered and other information needed to complete IRS Form 8962 Premium Tax Credit.

Form 1095-B is used by Health Insurance issuers to report to the IRS whether individuals have the minimum essential coverage necessary to comply with the ACA’s individual mandate.

Form 1095-C is used by large employers (those with 50 or more full-time employees) to report health coverage.

Our 1095 software makes it easy to import, print and/or efile IRS Forms 1095-B (and its 1094-B transmittal summary) and 1095-C (and its respective 1094-C transmittal summary) quickly and easily. The software includes the following 1095 modules:

Import…
Type information on the screen as it would be typed on the form itself. Or import the data from Excel (xls, xlsx) or some type of spreadsheet. Its easy to do and we have sample excel spreadsheets.

Print…
Our 1095 software will print the form and data or convert to PDF. Print Form 1095-A, 1095-B (and its transmittal summary 1094-B) and 1095-C (and respective transmittal summary 1094-C). Adjust the vertical and horizontal printing offsets so that your data prints perfectly on the form each and every time.

File Electronically…
File an unlimited number of 1095 forms electronically with the IRS.

Other Features…
Technical support is provided at no extra charge for the tax year that the software was purchased.

Free live update feature helps us communicate with you, the customer, and keep you up-to-date with the latest form revisions.

Data entered may be stored anywhere on your hard drive, portable drives, network drives or external diskettes for quick retrieval. You can also export your data to a csv file format.

Due Dates…
Furnish Copy B to the payer by January 31, 2016.

Paper file Copy A of this form with the IRS by February 28, 2016. If you file electronically, the due date is March 31, 2016.

The IRS states:

“Providers that file 250 or more information returns during the calendar year must file
the returns electronically.”

This 250 threshold applies to IRS Forms 1095-B and/or 1095-C.  If you have less than 250 employees, you can print and mail the forms to the IRS along with the respective 1094 transmittal summary.  If you have 250 or more employees, you must efile.

The first step to efiling is getting a transmitter control code or TCC number.  Here is what you need to know to attain the TCC number. The IRS states in Publication 5164:

“The application must include a minimum of one Responsible Official and minimum of two Contacts.”

This is important.  You need 2 contacts to go through the application process.  Specifically, that means you need to people to complete this first step which is applying for an e-services account.

1. E-services

E-services is a link on the IRS website that provides a variety of online tools for tax professionals.  The link is here

http://www.irs.gov/Tax-Professionals/e-services—Online-Tools-for-Tax-Professionals

One nifty online tool is Bulk TIN Matching.  You can upload a file with the TIN TYPE, NAME and TIN up to 100,000 records at a time and within a day the IRS will return the file letting you know which names match that specific a TIN and which names don’t.  It’s a great free service for cleaning up your data before electronically filing.

E-services also is where you can submit an application for a transmitter control code for the new ACA forms.  You need 2 people to go to the above E-services link and click on “Login or Register” and then click on “Register” and go through the online registration process which is below:

You need the name, SSN and date of birth for the applicant, but you also need the adjusted gross income which is line 37 on Form 1040 for the prior year.

You need 2 people to complete this registration.

2. Verify E-services within 28 days

At the end of the online registration, it says:

Your initial registration information has been received and successfully processed.  In the next few days, you should receive a letter via US Mail from the IRS.  This letter will contain a confirmation code and instructions for completing the e-services confirmation process.

All that work in registering is just the beginning.  You wait now for the letter from the IRS with a code.  When you have that code, you log back into the IRS site and type in that code to complete the registration. It takes about 14 days to get the letter with the confirmation code.

3. Log back in and fill out the ACA Application for TCC number

When you have finished registering for e-services, log back into e-services and you get to a screen that looks like this:

There is an option to select Individual and the Business you registered (we registered Ruth Technology).  To find the ACA Application for the TCC number, you must click Individual.  An individual can apply for a TCC number to file the 1095 forms electronically; a business can not.  I learned this the hard way by clicking on the Business (here Ruth Technology) and searching everywhere for the ACA Application and not finding it.  When I called the IRS, the agent explained clearly that individuals efile not businesses so individuals only can apply for a TCC number.

At the main menu, Click on Application.  And then ACA Application for TCC.  Click Start.  One responsible official fills out this ACA Application and within the application, you select yourself as a contact and another contact who has completed the e-services application (you can have more, but must have at least 2 contacts).

If you have any questions, call us at 608-444-6575.

Both individuals and businesses are subject to penalties for failure to comply with requirements of the Affordable Care Act.  Penalties are assessed and collected by the IRS, so there is little opportunity to avoid the mandates and associated penalties.

The following is a quick guide to the penalties that may be assessed for non-compliance.

Individual Mandate / Individual Shared Responsibility Provision

The individual mandate refers to the requirement for every US citizen to obtain minimum essential coverage as defined by the ACA.  If you do not obtain coverage, or it fails to meet ACA standards then you will pay the following penalty on your tax return:

• $325 per adult
• $162.50 per child
• $975 maximum for a family

• OR, 2% of your taxable income, whichever is greater

In future years the penalty (called a fee by the authors of the ACA) will increase until it is equal to the cost of the lowest level of coverage authorized under ACA standards.

There are exemptions available, and if you think you qualify for an exemption (such as low income) then you file Form 8965 with your tax return to claim it.

The Affordable Care Act really places the burden for obtaining coverage squarely on the shoulders of individuals, since the majority will not qualify for an exemption and no longer have the option of going without health insurance.

Employer Mandate / Employer Shared Responsibility Provision

Beginning in 2015, all businesses with 50 employees or more must provide health insurance to 95% of their employees or pay a penalty.  However, the business penalty is not computed on the tax return as with individuals, and is instead billed as a payment to the IRS.

Failure to provide any type of coverage will result in the following penalty:

• $2000 per employee (excluding the first 30 non-covered employees, and a special exclusion of the first 80 employees in 2015)

There are numerous rules surrounding business coverage, and it is interesting to note that 96% of all businesses in the US have fewer than 50 employees, so only 4% are subject to the employer mandate.

Businesses can also be penalized for failing to provide the required forms to employees that verify health coverage, so having a good tax accounting system in place is essential for large employers.

The Affordable Care Act has new filing requirements for tax year 2015 that apply to businesses offering health coverage. Not every employer offers health insurance, and some businesses are not required to file 1095-C and 1095-B. For this reason, it is helpful to review the guidelines for filing these new tax forms.

IRS Form 1095-C

Essentially, Form 1095-C is the method for large employers to demonstrate that they have met the ACA requirement of offering affordable coverage to their employees. Policies must be affordable and offer minimal value under ACA criteria, or the employer will face penalties.

IRS Form 1095-B

Form 1095-B is used to verify that an individual has ‘minimal essential coverage’ under the mandates of the Affordable Care Act (ACA). Form 1095B is prepared and filed by any entity that provides health coverage, including employers, and then the employee receives a copy to file with their own tax return to verify coverage.

Who Must File?

The criteria for filing can be determined by answering the following questions:

• Do you have more than 50 full time employees? (large employers)

If yes, are you self-insured? If yes you are self-insured, you must file form 1095-C, Parts I, II, and III. If no, you still file the form, but only Parts I and II.

• If you have less than 50 full time employees, but you are self insured, then you will have to file Form 1095-B, Parts I,II and IV.

In general, employers with less than 50 employees who are not self-insured do not have to file either Form 1095-B or 1095-C.

The forms are filed with the IRS, but each employee must receive a copy to file with their tax return, as a means of verifying that they have the minimum coverage required by the ACA. There are penalties that fail to supply accurate copies to employees, so this is an important aspect of the filing requirements for employer.

One form is filed for each employee, and then the employer will submit all the forms with one transmittal form, either Form 1094-C or 1094-B. This time consuming process for businesses is only one of the effects of the ACA, and requires a time investment for correct preparation, or the use of outside tax preparation services.

E-Filing 1095-B and/or 1095-C data involves creating and sending an XML files to the IRS.

The IRS will reject a transmission that contains

— Double Dash
# Hash Key

Both are consider prohibited characters.  If you have the address:

7 North Pinckney Street #240
7 North Pinckney Street — Suite 240

The transmission must not include the hash key or double dash and instead would appear as:

7 North Pinckney Street 240

The following special characters must be escaped before they are included in the data fields that allow escaped characters of either Forms 1094/1095-B or Forms 1094/1095-C transmissions:

&  Ampersand
‘    Apostrophe
”   Quotation Mark
<   Less Than
>   Greater Than

The escaped characters are:

&amp;    Ampersand
&apos;    Apostrophe
&quot;    Quotation Mark
&lt;         Less Than
&gt;        Greater Than

*Caution: “PersonFirstNm”, “PersonMiddleNm”, and “PersonLastNm” cannot contain any special characters. For example, if a record has a last name data field containing an apostrophe, such as “O’Malley”, the transmission cannot include the apostrophe or the escaped apostrophe characters. The apostrophe must be stripped and the last name data must be entered as “OMALLEY”. The transmission will be rejected if the apostrophe is used. As a rule the schema definitions must be followed. 26 However, the escaped apostrophe will be allowed in the “BusinessNameLine1Txt” and “BusinessNameLine2Txt” schema elements. Any special characters that are not listed in the Table 4-3 or Table 4-4 will be allowed as-is. For example, a hyphen is allowed in the “PersonFirstNm”, “PersonMiddleNm”, “PersonLastNm”, “BusinessNameLine1Txt” and “BusinessNameLine2Txt”.

Our 1095 software checks for each of these special characters and will warn the users of these characters prior to creating the XML file for transmission.

Common examples are as follows:

Example 1: If the employee’s last name is O’Brien, then the apostrophe must be removed and you should instead use OBrien.
Example 2: If the employer name is A&B Corporation, then the ampersand should be removed and you should instead use AB Corporation.
Example 3: If the address field is ‘Shepard’s Road, #240’, then the apostrophe and hash key should be removed and you should instead use ‘Shepards Road, Suite 240’.

In January, employees of large companies with more than 50 employees will receive Form 1095-C from their employer as part of the requirements of the Affordable Care Act (ACA).  If you have an employer that offers health coverage, then you will receive a copy of this form, which your employer files with the IRS.  You will receive Form 1095-C even if you decline the employer-offered coverage.

The form will have the following information:

• The type of coverage you were offered as an employee
• The lowest cost premium available
• Months of the year that the coverage was available

As an employee, you may have a question of whether you have to do anything with this form for your own income tax return.

The Purpose of Form 1095-C

Form 1095-C is the method for large employers to demonstrate that they have met the ACA requirement of offering affordable coverage to their employees.  Policies must be affordable and offer minimal value under ACA criteria, or the employer will face penalties.

In some cases, employers will not offer coverage and you will have to purchase insurance on your own.  If you buy coverage through the Healthcare Marketplace, then you will also receive 1095-A to verify the coverage.

If your employer does not meet this standard and employees must purchase coverage in the Healthcare Marketplace, then the employer would be levied an Employer Shared Responsibility Payment.  This payment is essentially used to offset the tax credit that employees will receive by purchasing their own coverage, and many large employers discontinued health coverage when they discovered the Shared Responsibility Payment was less costly than providing minimum value coverage.

Form 1095-C is also used by you as an employee:

• To determine if your plan offers minimal essential coverage
• To determine your eligibility for premium tax credits

If the employer provided coverage meets ACA criteria, then you simply check a box on your tax return that you have qualifying coverage.  If you opted to purchase health coverage in the ACA Marketplace, then you will file Form 8962 to claim the premium tax credit, which can help lessen the cost of health coverage.  Please see our related blog post on Form 8962 for an explanation of how to use this form.

One of the beneficial features of the Affordable Care Act (ACA) is that individuals who purchase health coverage through the Healthcare Marketplace may be eligible for a tax credit on their federal tax return.  Form 8962 is used to claim the credit, using information supplied on Form 1095A, Verification of Health Coverage.  It is important to note that the Premium Tax Credit is only available if you purchased a Marketplace health plan, and non-Marketplace plans will not qualify.

Who Needs to Fill Out Form 8962?

You only need to fill out the form if you bought coverage through the Healthcare Marketplace and if you are eligible for a tax credit.  In some cases, the tax credit was applied to reduce premium payments (cost assistance), and may not affect your final tax amount owed, unless there was an excess payment.

The Form 8962 can only be used with federal tax return forms 1040 or 1040-A, and cannot be used with 1040-EZ.  The instructions and calculations for Form 8962 are very detailed and may require tax preparation assistance for some filers.

How the Form is Used

The information that you need to fill out the form is on Form 1095-A, which gives the premium amounts and coverage details of your qualified health plan from the Marketplace.

The form has calculations that must be made based on the following items:

• MAGI: Modified Adjusted Gross Income, which takes into account any excluded income or benefits from the standard AGI computation.

• Number of family members and total household income.

• Comparison of household income as a percentage of the federal poverty level.

• If household income (based on MAGI) is between 100% and 400% of the federal poverty level, then you will qualify for the Premium Tax Credit.

All of these elements will be used to determine if you qualify for the premium tax credit.  If you received cost assistance, this is known as getting the tax credit in advance, and there is a place to note that on the form.  If the advance payment was in excess, or you did not qualify for some reason, then the amount will be added to your tax liability.  Excess advance payments are reported on line 46 of Form 1040, and the Net Premium Tax Credit is reported on line 69.

The Affordable Care Act (ACA) creates a mandate of a minimum level of health coverage for most individuals, and the IRS is the agency that is charged with enforcement.  As a result there are several new tax forms that you may receive this year, which detail the type and scope of your health coverage.  These forms have been optional until this year, but now are mandatory for tax year 2015.

Although similar, these forms have varying purposes for those filing their taxes.  This is a quick overview of each form, and you can find greater detail on the other blog posts for each specific form.

Form 1095-A: Verification of Health Coverage

This form is used to document that you purchased a health plan through the ACA Healthcare Marketplace, and that you have met the requirements for health coverage.  It can also be used to calculate whether you are entitled to any premium tax credits for purchasing coverage.

Form 1095-B: Verification of “Minimum Essential Coverage’

Form 1095-B is used to verify that any non-ACA Healthcare Marketplace policies meet the ACA standard of ‘minimum essential coverage.’  If you plan does not meet minimum standards then you will have to pay a penalty, known as the Shared Responsibility Payment.

Form 1095-C:  Minimal Essential Coverage by Large Employers

Employers with more than 50 full time employees will file this form and employees will receive a copy.  Form 1095C is the method for large employers to demonstrate that they have met the ACA requirement of offering affordable coverage to their employees.  If they do not offer adequate coverage, and employees must purchase insurance in the Healthcare Marketplace, then employers will pay a penalty.

How to Use the Forms

Depending on whether you purchased insurance yourself, or received it from an employer, you may receive a copy one of these forms by January 31, 2016.  The forms are filed by the entity that provides the coverage, either an employer, government agency, insurance company or Marketplace provider.

You will use the copy that you receive to verify coverage and apply for any tax credits that may be available.  If you have adequate coverage, then you will simply check a box on your income tax return.  If you are applying for a tax credit, then you will fill out and file Form 8962 using the information that is on Form 1095-A.

Also, if you do not purchase any insurance coverage, then you will pay a penalty on your income tax return, which is similar to any other tax liability.  The penalty for an individual for tax year 2015 is $325 or 2% of income.