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1094 Services Save Employer a 6-Digit IRS Penalty

Project Case Study


The Challenge

In 2018, a BMA client with 100 employees received an IRS J Letter informing them that they hadn’t provided sufficient proof of minimum essential coverage for their employees in their 2014 1094. This employer had filed their 1094s on their own, but because they had incorrectly filed them; this employer was deemed non-compliant with the ACA pay or play laws and now owed hundreds of thousands of dollars to the IRS. Overwhelmed by this steep penalty, the employer reached out to BMA for help.

Our Solution

Having produced and filed 1094s and 1095s many times before, BMA quickly worked toward a solution. Because this employer had a self-funded health plan, BMA had ready access to the plan data the employer needed to satisfy IRS reporting requirements. BMA quickly produced a report of the employees’ coverage and waiver records and instructed the employer how to file response to the IRS. Within a week, the employer’s IRS penalty was substantially reduced.

The Results

BMA’s quick response and resolution saved this employer hundreds of thousands in dollars in IRS penalties. This employer now uses BMA’s 1094/1095 Compliance Services to ensure that their IRS filings are complete and correct.

Why BMA is the Best Choice

Completing and submitting 1094s on your own leaves you subject to errors and IRS penalties, especially if it’s not something you do every day. It’s important to align yourself with a TPA who not only designs plans to meet pay or play requirements, but also gives you the information needed to meet the reporting requirements.

This employer’s story of 1094 compliance is not the only one. After more than 20 years, BMA has saved several employers from ACA penalties and helped them manage compliance more effectively. Our experience with compliance, combined with access to employers’ plan data, makes us a natural partner in ensuring your health benefit compliance.

About Our 1094 / 1095 Compliance Services

As a health plan designer and administrator, BMA does monthly tracking of which employees have elected coverage and which have waived coverage. We produce 1095s on behalf of the employers, which we can then mail directly to employees on the employers’ behalf or simply provide to the employer for distribution. BMA also produces 1094 documents and files them on the employer’s behalf.