LOS ANGELES, June 7, 2017 /PRNewswire/ -- First Capitol Consulting, Inc., (FCCI) has achieved a 100 percent success rate in assisting organizations with filing information returns mandated by the Affordable Care Act (ACA) by IRS deadlines for the 2016 tax reporting year. This is the second straight year FCCI has achieved this 100 percent success rate for its clients, helping them avoid significant financial penalties.
In working with a diverse group of organizations, from large and mid-sized companies to small businesses to major non-profits to educational organizations, FCCI has identified five common challenges it had to overcome to help clients comply with ACA requirements for the IRS.
Disjointed data silos. Many organizations keep their core data sets for human resources, payroll, time and attendance, leaves of absence, and health benefits in separate systems creating disjointed data silos of information. The inability of these systems to interact with each other creates a highly administrative and overly burdensome process to properly extract, aggregate, consolidate and validate the necessary data for accurate reporting to the IRS annually. Such inefficiencies make it challenging to implement an effective internal monitoring and tracking process of ACA compliance activities on a monthly basis to minimize potential ACA penalties from the IRS.
Unresolved data discrepancies between data silos. Core data sets often have inconsistent employee information between disjointed data silos. This can result in contradictions in hiring dates, salaries, and termination dates, and a lack of preparedness in recording and tracking of offers of benefits coverage to employees. Inadequate internal controls for periodically identifying and reconciling such inconsistencies lead to untimely offers of coverage to employees and erroneous IRS reporting that may lead to significant IRS penalty assessments.
Improper interpretation or application of the ACA Employer Mandate methodologies. Failure to correctly apply complex ACA methodologies sanctioned by the IRS, such as determining whether workers are full-time employees, inevitably leads to problems with proper reporting to the IRS. For example, companies with workforces that have a number of variable-hour, part-time or multi-position employees find it especially difficult to make accurate full-time determinations under the ACA.
Insufficient or non-existent documentation of ACA compliance activities. Lack of proper documentation can make it difficult for organizations to properly defend their business activities against regulatory inquiries, such as an IRS initiated ACA audit, which may result in tax penalties. Proper documentation is typically lacking at the (a) organization-level, i.e., ACA policies and procedures; and (b) employee-level, i.e., timely and accurate classification of all applicable employees.
Inadequate internal human and technology resources. Organizations face a significant challenge complying with the ACA if they do not have the right in-house staff, consultants and technologies in place to properly oversee the necessary data consolidation processes, application of ACA methodologies, and monthly tracking of ACA-related data and documentation. Such data consolidation is also critical for annual IRS Reporting and forms fulfillment, employee communications about ACA matters, and Exchange Notice appeals.
About First Capitol Consulting, Inc.
First Capitol Consulting, Inc. is a technology company with a human touch. Our data specialists use innovative science, data analytics, and intelligent technology to break new ground in data consolidation and data scrubbing. We take this clean data and apply our regulatory and tax expertise gained from decades of experience working in national law firms and "Big 4" accounting firms to drive unparalleled regulatory compliance services, tax strategies and actionable intelligence to help organizations make wise business decisions. Find out more about FCCI and their innovative products and services at www.firstcapitolconsulting.com
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SOURCE First Capitol Consulting, Inc.