The Paperwork Burden Reduction Act (PBRA) and its impact on ACA filing

The Paperwork Burden Reduction Act of 2024 (PBRA) reduces paperwork for businesses, individuals, and government agencies, particularly as digital processes expand. It builds on the Paperwork Reduction Act (PRA) of 1980 with new measures to improve efficiency and lower administrative costs, especially for Affordable Care Act (ACA) filing. Employers must navigate evolving regulations while ensuring accuracy and efficiency in their submissions.

Understanding the Paperwork Burden Reduction Act of 2024

The PBRA modernizes reporting requirements and streamlines federal compliance submissions. It requires agencies to optimize electronic filing, eliminate redundant reporting, and improve access to digital compliance tools. The Office of Management and Budget (OMB) oversees these efforts to ensure efficient data collection with minimal business disruption.

How PBRA Affects ACA Filing

ACA filing, particularly Forms 1094-C and 1095-C, requires significant data collection and reporting from applicable large employers (ALEs). The IRS and other agencies have adjusted reporting processes to align with PBRA objectives, enhancing digital filing, reducing administrative burden, and improving compliance workflows.

Key Impacts of the PBRA on ACA Reporting

  1. Mandatory electronic filing: Employers filing 10 or more ACA returns must now submit them electronically, cutting paper waste and administrative effort.
  2. Elimination of employee form distribution: Employers no longer need to send Forms 1095-B or 1095-C to employees. Instead, employees can request these forms if needed, reducing unnecessary paperwork.
  3. Simplified form requirements: The PBRA pushes the IRS to streamline ACA forms, keeping only essential data and removing redundant fields.
  4. Enhanced automation and digital integration: Employers increasingly use benefits administration technology to automate data collection, validation, and filing, reducing manual work and errors.
  5. Lower employer compliance burden: Expanded electronic submissions allow employers to focus on compliance rather than paperwork, decreasing filing errors and penalties.
  6. Extended response time to penalty letters: Employers now have more time to respond to ACA-related IRS penalty notices, allowing better review and dispute opportunities.
  7. Statute of limitations on penalty assessments: A new time limit restricts how long the IRS can impose ACA noncompliance fines, providing employers with greater predictability and protection.

Navigating ACA Compliance Under the PBRA

Employers should use ACA compliance technology to meet new PBRA regulations. Outsourcing ACA filing can help businesses:

  • Automate ACA form generation and submission
  • Ensure compliance with updated federal rules
  • Minimize IRS penalty risks
  • Eliminate unnecessary paperwork and manual reporting

Final Thoughts

The PBRA modernizes ACA filing by enforcing electronic submissions, eliminating required employee form distribution, extending penalty response times, and setting a statute of limitations on penalties. Businesses that adopt digital solutions will improve compliance accuracy and efficiency. By leveraging filing services and staying updated on regulations, employers can reduce administrative burdens while ensuring full ACA compliance.

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