Many business owners are unaware of the risk factors that can trigger an ACA audit, or how costly those penalties can be if mistakes are made. This blog will educate readers on the most common causes of ACA audits, provide strategies for avoiding penalties, and explain how TEL Staffing & HR can offer protection and peace of mind by handling compliance for them. Real-life examples of businesses saved from costly penalties through the help of a PEO will make this blog engaging and relatable.
Understanding What Triggers an ACA Audit
The Affordable Care Act (ACA) has specific compliance requirements, and failing to meet these can trigger an audit. Common triggers include inconsistencies in reported employee data, late filings, and discrepancies between reported information and actual practices. Certain red flags like a high number of employee complaints or significant changes in workforce size can also attract scrutiny.
Understanding these triggers is the first step in protecting your business. Regularly reviewing your compliance status and ensuring all data is accurate and timely can help you avoid unnecessary audits.
Common Pitfalls and How to Avoid Them
One common pitfall is failing to accurately classify employees, which can lead to incorrect reporting and potential penalties. Misclassifying full-time employees as part-time to avoid offering health benefits is a major red flag.
Another frequent issue is failing to file the necessary forms on time. The IRS requires specific forms (e.g., 1094-C, 1095-C) to be filed annually, and missing these deadlines can result in hefty fines. To avoid these pitfalls, establish a clear internal process for data collection and reporting, and consider using automated systems to ensure compliance.
Strategies for Accurate Record-Keeping and Reporting
Accurate record-keeping is crucial for ACA compliance. Maintain detailed records of employee hours, wages, and benefits. This includes tracking part-time and variable-hour employees, whose status might change over time.
Invest in reliable HR software that can automate record-keeping and reporting processes. Regular audits of your own records can help identify and correct errors before they become a problem. Training staff on the importance of accurate data entry and compliance can also reduce the risk of mistakes.
Real-Life Success Stories: How PEO Services Helped Businesses
Consider the case of a mid-sized construction company that faced an ACA audit due to inconsistencies in their employee data. By partnering with a Professional Employer Organization (PEO), the company was able to streamline their reporting processes and ensure accurate record-keeping. The PEO's expertise in compliance helped them avoid costly penalties and focus on their core business operations.
Another example is a non-profit organization that struggled with timely filings and employee classification. With the help of a PEO, they implemented a robust compliance system, which not only prevented audits but also improved overall operational efficiency.
Minimizing Risk with TEL Staffing & HR
TEL Staffing & HR specializes in helping businesses navigate the complexities of ACA compliance. By handling your compliance needs, TEL Staffing & HR minimizes the risk of audits and penalties. They offer comprehensive services including accurate record-keeping, timely reporting, and expert consultations to ensure your business stays compliant.
Partnering with TEL Staffing & HR provides peace of mind, allowing you to focus on growing your business while they handle the intricacies of ACA compliance. Their proven track record and expertise make them an invaluable ally in maintaining compli