Everything Employers Need to Know About 2025 ACA Reporting

By: Melissa Olson   December 3, 2024

In 2023, the IRS issued over $990 million in excise tax penalties, including those tied to the Affordable Care Act’s (ACA) Employer Mandate.

With 4980H(a) and (b) penalties increasing in 2024, accurate and timely compliance with the now 14-year-old healthcare law is more critical than ever.

As 2025 approaches, organizations must prepare to meet the ACA Employer Shared Responsibility Provisions, also known as the Employer Mandate. This law requires employers to submit key healthcare filings, and failure to do so risks additional penalties under IRC 6721/6722.

In this post, we’ll break down ACA employer requirements, the upcoming 2025 deadlines for reporting 2024 information, and how Infor solutions can streamline compliance to help you avoid costly fines.

What’s Required Under ACA’s Employer Mandate?

The Employer Mandate requires Applicable Large Employers (ALEs), known as organizations with 50 or more full-time or full-time equivalent employees, to provide Minimum Essential Coverage that meets affordability and Minimum Value to at least 95% of their full-time employees and their dependents.

On an annual basis, ALEs must report this information to the IRS by transmitting 1095-C forms, as well as to certain states that have ACA requirements (more on that below). Organizations offering self-funded insurance plans, as well as health carriers, will also need to report this information to the IRS via Form 1095-B.

Below are the major ACA reporting deadlines for the 2024 tax year, to be completed in 2025.

ACA Paper Filing Deadline

Employers opting to file their ACA forms via physical paper mail for the 2024 tax year have until Friday, February 28, 2025. Previously, organizations could file up to 250 paper filings, but recent legislation has significantly reduced this threshold to encourage electronic filing.

Now, organizations may only submit paper filings if they have 10 or fewer 1095-C forms. For organizations that filed physically in the past, this change may require a transition to electronic filing for 2024 submissions.

If your organization needs assistance implementing an electronic filing process, RPI Consultants can help simplify this transition.

ACA Electronic Filing Deadline

With paper filing limited to organizations only filing 10 or fewer 1095-C forms, the vast majority of organizations will need to submit their ACA information electronically via the Affordable Care Act Information Returns (AIR) portal.

For the 2024 tax year, employers must submit the 1094-C and 1095-C to the IRS by Monday, March 31, 2025.

ACA Furnishing Deadline

In addition to filing ACA information to the IRS, organizations have the additional burden of furnishing enrollment information to their full-time employees.

The deadline for distributing 1095-C forms to employees for the 2024 tax year is Monday, March 3, 2025. In recent years, the IRS permanently extended the original January 31 deadline by 30 days, allowing additional time for employers to issue these forms.

PCORI Fees Deadline

Beyond filing and furnishing ACA information annually, there are more requirements for organizations that offer self-funded health insurance plans. These organizations must also meet the Patient-Centered Outcomes Research Institute (PCORI) fee deadline.

For the 2024 tax year, these fees are due by Thursday, July 31, 2025. According to United Healthcare, plan years ending between October 1, 2023, and October 1, 2024, require a fee of $3.22 per person, reflecting the same rate as the previous year.

State ACA Reporting Deadlines

In addition to the federal deadlines, states such as California, Massachusetts, New Jersey, Rhode Island, and Washington, D.C., require ACA reporting. Remember, your business must comply with these state ACA reporting requirements if you have just one employee working in these jurisdictions.

Employee location dictates state ACA filing obligations, making compliance essential, especially for employers with remote workforces. Below are the state and IRS reporting deadlines for 2024, to be completed in 2025:

Are There Penalties for ACA Non-Compliance?

Yes. Failing to meet ACA reporting deadlines can result in significant penalties under IRC 6721/6722. Employers may receive penalty notices via Letter 972CG or Letter 5005-A for missed or late filings.

Organizations can face additional penalties, namely Letter 226J, for non-compliance with the Employer Mandate itself. This includes failing to offer Minimum Essential Coverage that is affordable and meets Minimum Value to at least 95% of an organization’s full-time employees and their dependents.

Good record-keeping and employee data management are essential to minimize the risk of penalties. Since the IRS phased out “Good-Faith Relief” in 2021, organizations must ensure full compliance with the ACA requirements. Moreover, the IRS made clear that there are no statute of limitations regarding the issuance of ACA penalties, so notices for previous years’ are fair game as well.

ACA Compliance Going Forward

Organizations would be remiss to neglect ongoing ACA compliance following the completion of the 2024 calendar year requirements. January 1, 2025, also marks the beginning of a new year of ACA Employer Mandate requirements.

One thing businesses should take note of as they continue monitoring their ACA compliance efforts includes the annually-changing affordability threshold. Beginning in January, the 2025 ACA affordability threshold is 9.02%.

That means businesses will need to offer healthcare that does not exceed 9.02% of their employees’ annual income and may use one of the IRS sanctioned safe harbors for doing so, which are the W-2, Rate of Pay, and FPL.

RPI Consultants can help you set up ACA contribution amounts using the Infor Benefits module, as well as set up eligibility determination, offer tracking, waiver management, and enrollment capture.

Get Help with ACA Reporting

Even as ACA reporting enters its tenth year, many organizations still find compliance challenging due to shifting requirements and evolving reporting requirements. Staying on top of these updates can feel overwhelming.

Infor CloudSuite’s Benefits Module, part of CloudSuite GHR, supports ACA compliance by tracking employee coverage, managing benefit costs, and ensuring timely 1095-C transmission to the IRS. This module is invaluable for managing ACA requirements within a single, cohesive platform.

Organizations face a balancing act, providing valuable healthcare benefits while keeping up with the ACA’s complex requirements. If your team needs support with ACA compliance, reach out to RPI Consultants. We can help you configure your Infor systems so that they are ready for the upcoming ACA reporting deadlines.

For more insights on ACA compliance and Infor benefits, register for our upcoming webinar, ACA Compliance: Proactive Strategies to Help Avoid Penalties, featuring RPI’s Valerie Holschen and ADP’s Wendy Delgado-King.