Tax Alert: Employers Affected by Recent Updates from the IRS and USCIS

Employers should take note of two important notices made by the federal government last week. These announcements involved changes to the Affordable Care Act (ACA) reporting requirements in 2016 and revisions to Form I-9 (Employment Eligibility Verification).

ACA Relief

On Friday, the Internal Revenue Service issued Notice 2016-70 to provide relief to employers subject to the Affordable Care Act (ACA) reporting requirements for 2016. Acknowledging the significant amount of time it takes to implement a new system and the complexities surrounding ACA compliance, the IRS announced that:

  • The due date to furnish Form 1095 to employees is extended from January 31, 2017 to March 2, 2017.  The due date to file Forms 1094 and 1095 with the IRS is not extended and remains February 28, 2017 (if paper filing) and March 31, 2017 (if filing electronically).
  • The “good-faith transition relief” that was offered last year is also extended for 2016. Under this relief, employers who make a good-faith effort to comply with the reporting requirements will not be penalized for incorrect or incomplete information reported on the statement or return, such as missing or inaccurate social security numbers, dates of birth and other information required on the forms.  This relief is not available to employers who do not timely file the forms.

Revised I-9

In addition, the U.S. Citizenship and Immigration Services (USCIS) released a new version of Form I-9 (Employment Eligibility Verification) last week. The changes are designed to simplify the process of completing the form electronically and streamline the certification process for certain foreign nationals.

Employers are required to begin using the new form by January 22, 2017. Until then, either the new form (dated 11/14/16) or the prior form (dated 3/8/13) may be used.

Please contact your Sax advisor if you have any questions or require further clarification about these updates.

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