With the April 1st deadline for electronically filing ACA returns (Forms 1094-C and 1095-C) quickly approaching, agencies should maintain a file of records after completing the filings. Keeping a record of the filings will serve to defend the agency in the event the IRS charges the agency with a potential penalty under for failing to furnish and/or file forms under Internal Revenue Code sections 6721 and 6722. Applicable Large Employers who must comply with these ACA reporting requirements should retain the following records:
(1) Documentation proving the employer furnished (handed out or mailed) Forms 1095-C to current and former full-time employees by the March 1 deadline in advance of the filing with the IRS.
(2) A copy of all Forms 1094-C and 1095-C within each submission to the IRS, along with the Receipt ID for each transmission.
(3) A document showing the transmission status when the IRS completes processing. The transmission status should state one of the following: Accepted, Accepted With Errors, Partially Accepted, or Rejected.
(4) If the transmission status is anything but “Accepted,” maintain the Error Data File. The Error Data File contains a detailed list of errors, which are critical to understand for making corrections. Employers should troubleshoot the error and refile the forms without error as soon as possible.
Employers who use a third-party transmitter to file documents should obtain these same records in case the third-party transmitter becomes unavailable to file corrections for the employer. The employer will be ultimately responsible for all filings and potential penalties even if the employer utilizes a third party vendor or transmitter.