Notice of Marketplace Coverage
July 16, 2016
The Affordable Care Act (ACA) rules require the federal and state Marketplaces to send a notice to employers if an employee qualifies for a subsidy. It has come to our attention that these notices are now being sent.
These notices are generally intended to alert you that an employee receive a subsidy in the Marketplace and are not the official notice from the IRS regarding a penalty. An appeal with the Marketplace may only be necessary if the employee referenced in the letter received an ACA offer of affordable coverage from your organization. Individuals receiving an offer of affordable coverage from an employer would not qualify for a subsidy. No appeal is necessary if the employee is part time or otherwise did not receive an offer of affordable coverage.
If this issue is identified by the IRS as a concern, you will be given the opportunity to provide a response. Once the IRS reviews both the Marketplace and employer information, it will provide a ruling on the penalty, if any. It may be a while (or not at all) before the IRS identities this situation.
If you receive a notice about an employee, we suggest using this time to gather and store documents to prepare for the potential IRS inquiry. Measurement Period results, premium contribution levels, and waivers of coverage documents are examples of some of the records that may be beneficial during an IRS review.