Affordable Care Act (ACA) Compliance in Microsoft Dynamics GP
Posted by Donna Krizik on September 29, 2015
We are down to the wire on planning for and enacting changes in our accounting systems to comply with the ACA requirements. I know it has been a bit of a learning curve over the last few years, but be assured, Crestwood is here to help you.
2015 is where the rubber meets the road – the changes that have been talked about for the last few years have become mandatory, requiring real change to the way we do things and invoking penalties if we don’t. Here are the facts, and recommendations on how to prepare.
1095A, mandatory for 2014, captures the information necessary to calculate the insurance premium tax credit for anyone insured through the Marketplace.
1095B, optional for 2014, but mandatory for 2015, indicates whether the employee, their spouse, and their dependents had health coverage for some or all of the months of the calendar year.
1095C, also optional for 2014, but mandatory for 2015, only applies to employers with 50 or more full-time employees (FTEs). The form indicates whether the employer offered health coverage to the employee, spouse or dependents for some or all months of the calendar year.
Tip: Make sure your organization knows who is responsible for these forms. Is it HR or Accounting? Also understand that these are tax forms, not health forms. Your company and your employees will need them for tax return prep.
Microsoft’s Changes to Dynamics GP
Microsoft has begun by implementing ACA tracking mechanisms with the Dynamics GP Year End Update. In addition, changes they make throughout the year will ensure you'll be able to successfully generate the 1094-C and 1095-C forms at the end of 2015.
In addition to the Payroll module, the Human Resources module is also required to track Affordable Care Act information in Microsoft Dynamics GP.
The HR module is included at no extra cost with Microsoft Dynamics GP 2013 and beyond.
Preparing to Track ACA Information:
Install the 2014 Year End Update
Install Human Resources
Install Human Resources and Payroll Suite to utilize Deductions In Arrears (DIA)
Deductions In Arrears allows you to track uncollected deductions to ensure they are recovered in a future pay run.
Add all Employee Dependents
Ensure Benefits and Deductions exist both in Human Resources and Payroll (Integration between HR and PR complete)
If you haven’t already determined the initial eligibility of continuing employees with respect to meeting the 30-hour threshold for full-time designation, you have some work cut out for you. You will need to:
Calculate eligibility of continuing employees for employer-provided health care coverage.
Offer coverage to all full-time employees, including variable-hour employees determined to be full-time.
Sign up the employees that accepted this coverage, with the coverage being effective no later than January 1, 2015.
Are there exceptions?
The only exceptions to this requirement above are companies that have non-calendar year plans which were in place on December 27, 2012 and have since had no alternation as to the plan start and end dates. For the limited period of time in 2015 where such a plan will go from 2014 to 2015, those employers will be exempt from Shared Responsibility Payments penalties until the new plan year begins in 2015.
For 2015 only, employers with more than 50 full-time employees and equivalents but fewer than 100 will not be required to submit reporting to the IRS in January 2016 about employee data in 2015. Those employers will, however, still be required to provide their ACA-defined employees with IRS Form 1095-C.
Is singly owned.
Has a stable workforce of primarily full-time employees who are paid above-minimum wage.
Has a limited number of part-time employees, all of whom have consistent hours.
Already offers health coverage.
Has fewer than 250 full time employees.
You are running Microsoft Dynamics GP 2013, Microsoft Dynamics GP 2013 R2 or Microsoft Dynamics GP 2015. (Add on tools work with previous versions)
Microsoft will track data for hours worked and deductions. Additional fields will be added in the Human Resources module for dependents and coverage type. Microsoft will not include reporting to track eligibility and affordability. This must be done manually or with an add-on tool.
Though Dynamics GP will be generating forms for distribution to full-time employees, determining ACA full-time status of employees will NOT be automated in GP.
Dynamics GP will not handle reporting for multiple payroll databases, however it should be possible using SSRS (SQL Server Reporting Services) or an add-on tool.
An ACA reality is that annual reporting for companies that are commonly controlled or affiliated must be done on a consolidated basis and that determination of individual employee eligibility must be done on an aggregated basis. This should able be possible using SSRS or an add-on tool.
- Integrity-Data’s ACA Compliance Tool (the only tool that allows you to be IRS-compliant without leaving Dynamics GP)
- Aim Technologies’ ACA Dashboard
Crestwood has worked with all of these solutions and can recommend the right tool for you.
Crestwood strives to help our clients comply with the new requirements of the ACA. However, we are not ACA experts. You should ALWAYS speak to a tax professional to confirm compliance.
Crestwood clients can contact us for Microsoft Dynamics GP year end and payroll processing assistance at firstname.lastname@example.org or 847-394-8820 x7.
Here’s a year end preparation guide, to get you ready for closing year end.
Attend one of our year-end seminars or webinars for more help with closing out your year correctly and setting up for a successful 2016. Details on these events will be posted to our website soon.