IRS Issuing ACA Penalty Notices

According to the IRS updated Q&A page, beginning in December 2017, businesses with 50 or more employees may receive ACA penalty notices for years 2015 – 2016.  These IRS penalty notices will come in the form of a letter, Letter 226J.  Attached is a copy of what the Letter 226J will look like.

Companies will be required to provide the IRS with the information requested by the response date shown in the letter which will typically be 30 days from the date the letter was issued.  Additionally, the letter will state any penalties that have been calculated.  If the Company disagrees with the proposed penalties, it must respond with a protest letter outlining why the penalties should not be assessed.

If the company does not respond within the time period, the IRS will issue a Notice of Demand For Payment.

First Advantage’s ACA specialists are here to assist clients with reviewing and responding to the ACA penalty notices.  We are offering free consultations to clients even if you are not a current ACA client of First Advantage.  Please contact your tax account manager or your background/drug screening account manager if you would like a free ACA consultation or you can call Michael Harless from First Advantage at 317.324.3153.

View the sample letter here.