7 Tips to Get Your Team to Actually Listen to You
Original post entrepreneur.com
Right from the outset, entrepreneurs must pay attention to every communication and opportunity for sharing their passion and vision. They must communicate effectively, so they can inspire others to come aboard. They must speak honestly and in ways that reveal their personal character and genuine connection. Yet, this sort of communication style can be difficult and time consuming – especially when demands are huge and time is scarce.
There is far more to being an effective and authentic communicator than most entrepreneurs believe -- at least when they are starting out. Even if you think you’re good at speaking to your team and motivating them, there’s always more to learn.
Leadership communication is a discipline and a practice: The more time, effort and heart you put in, the more effective you become. There really are no shortcuts.
That said, here are seven ideas that can help you focus your attention and improve your leadership communication.
1. Be authentic.
When you speak with your employees you must come across to them as real. This means sharing your beliefs and your struggles. Talking about moments of doubt but also explaining how you overcame them with more conviction and confidence than ever. Or perhaps share a story or two about a failure and disappointment in life.
The most convincing talks are when stories are shared about personal weaknesses and what one was doing to overcome them or disappointments and failures and how they were turned around.
2. Know yourself.
Dig deep. Know your values and what motivates you. If you don’t know yourself you cannot share or connect with others. People want to know what makes you tick as a human being not just as a leader. Share this and make yourself real.
3. Rely on a good coach or a trusted advisor.
Developing good communication skills takes time -- and in the rush of business, that’s scarce. Having someone who can push you to examine and reveal your interests and passions is enormously helpful and the value is immeasurable.
4. Read up on leadership communication.
If you can’t hire a coach, read all that you can. This is an inexhaustible resource, and you should never quit learning anyway. Books, articles, the internet; the possibilities are endless.
5. Make values visible.
Effective, empathetic communication and a commitment to culture can provide a solid foundation for your ideas and contribute to making it a reality. Many of today’s most successful companies have gone through dramatic crises. Their improvements often hinged upon genuine communication from the leaders.
For instance, think of Starbucks and Howard Schultz’s clear and genuine communications about the importance of managers and baristas being personally accountable for future success. Your employees want to know what you and the company stands for. What is the litmus test for everything you do? These are your values. Talk about them but you must always be sure to “walk the talk” and live by them.
6. Engage with stories.
You can't rely on facts and figures alone. It’s stories that people remember. The personal experiences and stories you share with others create emotional engagement, decrease resistance and give meaning. It is meaning that gets employees' hearts and fuels discretionary effort, thinking and desire to actively support the business.
Once someone was implementing a massive pricing cut. He could have presented reams of data about this change and why it needed to be made. Instead he invited in four clients of the firm who had written letters about why after more than 10 years they had decided to leave due to our pricing being noncompetitive. Everyone was engaged and quite horrified to hear this feedback. Getting the team’s support for the change was much easier after that.
7. Be fully present.
There is no autopilot for leadership communication. You must be fully present to move people to listen and pay attention, rather than simply be in attendance. Any time you are communicating, you need to be prepared -- and to speak from your heart. Leadership communication is, after all, about how you make others feel. What do you want people to feel, believe and do as a result of your communication? This absolutely can't happen if you read a speech. No matter how beautifully it is written, it doesn’t come across as authentic or from your heart if you are reading it. Embrace what you want to say and use notes if you must, but never read a speech if you want to be believable and move people to action. (And yes this requires a ton of preparation).
Your speeches are visible and important components of your role as a leader. Successful entrepreneurs are conscious of that role in every communication, interaction and venue within the organization and beyond. They also know that while today’s world provides a wide range of ways to communicate to your organization -- mass email, text, Twitter, instant message and more --connecting is not that simple. Electronic communication is a tool for communicating information -- not for inspiring passion.
Regulatory clarity makes ID protection a more attractive employee benefit
Original post benefitsnews.com
Identity theft is the fastest growing crime and consumer complaint in America, and benefit industry experts say concerned employees are seeking protection as an employer perk more than ever. New regulatory certainty about how identity theft protection benefits are taxed could increase the popularity of the benefit as an employer offering.
More than 13 million Americans fall victim to identity theft every year, which means every three seconds someone's identity is stolen. Increased concern about the crime has individuals clamoring for identity theft protection benefits. How that benefit would be taxed, however, had been a topic of some debate in the benefit industry, with some employers eager to offer the benefit but concerned about the impact on employee income taxes.
In its Dec. 30 announcement, the IRS said it will allow preferential tax treatment for employer-provided identity theft benefits, despite the absence of a data breach. Generally, all benefits provided to an employee by an employer must be treated as income, unless the Code provides an exclusion. Previous guidance from the IRS created an exclusion for identity protection services, but only after a breach and only for individuals whose personal information might have been compromised.
The IRS’s latest announcement notes that several commenters requested guidance regarding the tax treatment of identity protection services provided before a data breach. According to the commenters, these services are being provided with increasing frequency in order to allow early detection of data breaches and minimize the impact of breaches when they occur. In response, the IRS has concluded that its previous guidance should be extended.
“The IRS will not assert that an individual must include in gross income the value of identity protection services provided by the individual’s employer or by another organization to which the individual provided personal information (for example, name, social security number, or banking or credit account numbers). Additionally, the IRS will not assert that an employer providing identity protection services to its employees must include the value of the identity protection services in the employees’ gross income and wages. The IRS also will not assert that these amounts must be reported on an information return (such as Form W-2 or Form 1099-MISC) filed with respect to such individuals,” the guidance states.
Any further guidance on the taxability of these benefits will be applied prospectively, it adds.
“This guidance is welcome news for employers that want to offer identity protection services to employees as part of their data security strategy. They may now offer these services without increasing their (or their employees’) federal tax liability. However, employers should be mindful of state and/or local tax laws as they may differ from federal tax law,” according to Tzvia Feiertag, a senior associate in the Labor & Employment Law Department of the global law firm Proskauer.
The preferential tax treatment does not apply to cash received in lieu of identity protection services or to proceeds received under an existing identity theft insurance policy, the guidance says.
3 ways gamification can improve your team’s well-being
Original post benefitsnews.com
What does a big, fancy word like “gamification” mean anyway? Simply put, it’s the idea that game-like rules and rewards make the hard stuff fun. And smart leaders now use it to engage and motivate their employees.
Well-known game designer Jane McGonigal says “living gamefully” helps people bring curiosity, passion and balance into their lives. It gives them a higher purpose so they keep moving forward in their mission even when obstacles block their vision.
Gamification is the reason fitness apps work. When the buzzer signals that you hit 10,000 steps, you win. Even performance reviews contain elements of game design – when your employees exceed all their goals and move to the next career level, you both win.
Let’s go for that big win. Help your employees achieve their goals and improve their health by introducing these gamification strategies.
3 gamification strategies to implement:
1. Wellness quests. As noted above, wearable technology makes tracking exercise so much easier. But gamification for health doesn’t require that level of sophistication — you can make a game out of almost anything when you keep score by pencil. Challenge your team members to sneak extra exercise into their day. Have them jot down a checkmark every time they take a stretch break. Heat up competition by posting results on a whiteboard for all to see. Add rules or creative complexities as time goes on and the activities become easier. The more quests employees complete, the healthier they’ll be.
2. Social communities. We all need a little help from our allies. We crave support from one another, and we’re willing to dig in deeper when we know others are rooting for us. So it’s no surprise that social interactions and competitions help employees stay motivated and happy. Hook your employees into healthy activities with team vs. team challenges, photos, comments, nudges and cheers. Recognize accomplishments in ways that best fit your company’s culture – whether that’s sending around leader-board rankings each week or letting peers nominate each other for special badges.
3. Power-ups. The journey to well-being is never over — but it’s nearly impossible to keep going if you don’t hit milestones. This is when you need to activate “power-ups” — the quick tasks that feel like small wins. Remember how satisfying those power-ups were in your video games of childhood? Encourage your employees to take baby steps toward their goals. For instance, they may not have time for a lunchtime workout, but can they sneak in a few jumping jacks before every meeting? How about simply standing up for two minutes? Or taking a mid-meeting plank break? Achievements like these provide a burst of feel-good energy and intrinsic motivation to help us stick with lofty commitments.
15 tips to improve employee engagement
A great deal of time is spent making sure the communication between you and your consumer is on point. But what about the communication between you and your employees?
Gary Grates, a globally renowned, recognized, and respected expert in employee engagement, wrote in a 2004 PRSA Strategist article, "“Employees want to know what the company believes in and what it will fight for — its mission, vision and values; its foundational principles. They will commit or not commit, engage or disengage, on the basis of that foundation.”
Engaged employees are involved, enthusiastic and committed to their work. Their engagement can determine the outcome of a project.
However, engaged employees are not the norm according to Gallup's 15 years of research. Employee engagement has consistently averaged less than 33 percent in the United States. Worldwide it's even lower at just 13 percent.
So, what can you do as an employer to change that trend?
Behan Communications put together this list of 15 ways to improve internal engagement.
- Be clear and concise:
Overwriting and using technical jargon will lead to confusion and misunderstanding. - Set the tone at the top:
CEOs and senior leaders need to set the tone. They need to be visible and accessible, and they need to understand that there’s a correlation between strategic employee communications and the achievement of organizational goals. - Understand your employees:
You may need to communicate differently with different audiences. For custodians who don’t use computers at work, e-mail is ineffective. To determine your employees’ needs and perceptions, consider surveying them regularly: Are they getting the information they need? - Use many channels:
Most people need to hear or see a message multiple times, in multiple ways, to understand it completely. Distribute your messages electronically, in writing, face-to-face and at forums and meetings. Your message should be consistent across all of these channels. - Provide context:
Employees need to hear information at multiple levels. Provide context (what external factors are at play?); explain strategy (why did we decide to respond this way?); and make it personal (how will this affect me?) - Be timely: make employees first!
When you prioritize your communications, always think of your internal people first. Your employees should hear it from you before they hear it from anyone else — they shouldn’t be surprised by a media report. - Be forthcoming and be continuous:
Always communicate, and communicate both good and bad news. If you are honest and candid in sharing bad news, your good news is more credible. - Match actions with words:
If you say you will address a situation in a certain way, do it. If you don’t, you’re undermining your credibility. - Emphasize face-to-face communications:
Although today’s employees may be more tech-savvy than ever, nothing beats human interaction: Most employees want to hear news and information from their supervisors. Managers need to be trained in how to communicate, and they need to have the right tools at hand. If you are expecting your managers to help explain a complicated change to the organization’s pension plan, you’d better provide them with talking points and handouts. - Create an organizational habit for communications:
You know you need to communicate about policies; health and safety; benefits; and how a job should be carried out. But remember that you also need to share information about your organization — what our your objectives? How are you performing? What are your plans and prospects? How can employees help? - Plan:
Be systematic and strategic. Have an editorial calendar that spells out what you’ll say, when you’ll say it, where you’ll say it and how you’ll say it. Develop a checklist of what needs to be communicated. - Measure effectiveness:
Set some objectives and be prepared to assess whether you have met them, whether they are employee engagement goals or perception goals. You might want to regularly assess engagement levels and ask employees whether the organization has communicated its strategy well. Do they understand how their daily work helps the organization meet its goals? - Facilitate two-way conversation:
One-way communication is a thing of the past. Individuals are empowered to talk back, and feeling “listened to” enhances feelings of trust. There are many ways to facilitate two-way communication, including face-to-face meetings; “town hall” meetings; interactive video interviews; Twitter questions; employee surveys; Q-and-A features on the employee intranet; and anonymous suggestions via e-mail or suggestion boxes. - Be objective:
Don’t “spin,” or try to dictate or assume how people should feel about the news you’re sharing. - Say “thank you” as much as possible:
If an employee feels appreciated, she’s more likely to feel engaged.
The Dish with Deborah Miller
February's Dish serves up Saxon's Deborah Miller's favorites. For the nights you want to stay in, Miller suggests Chicken Parmesan. On the nights Miller heads out to eat, you can find her at The Eagle.
Chicken Parmesan
- Flour
- Scrambled eggs
- Bread crumbs
- Chicken breast
- Mozzarella cheese
- Marinara sauce
Pre heat oven to 350.
Put into separate bowls flour, scrambled eggs, and bread crumbs.
Dip the chicken breast into the flour, then the eggs, then the bread crumbs making sure the chicken breast is well coated.
Place the chicken in a pan with hot oil and let it fry for a few minutes on each side.
After the chicken has fried place it into a baking pan with your favorite marinara sauce in the bottom of the pan.
Then, place mozzarella cheese on it and more marinara sauce.
Place the chicken in the oven for about 20 minutes until the chicken has cooked through and the cheese has melted.
Serve with spaghetti and garlic bread.
The Eagle
1342 Vine St.
Cincinnati, OH 45217
The Eagle has the best fried chicken and macaroni and cheese in the city! The wait can be a few hours, but it is well worth the wait especially on a nice evening.
Audit: What should I expect from a Department of Labor audit?
Original post by shrm.org
Employers should keep in mind that the U.S. Department of Labor (DOL) can audit employers at any time, although the most common reason for a DOL audit is a complaint from an employee.
The DOL has also targeted employers in low-wage industries for wage and hour violations, particularly in the areas of agriculture, day cares, restaurants, garment manufacturing, guard services, health care, hotels and motels, janitorial services, and temporary help. By understanding the audit process and following the guidance below, employers will be better prepared to handle a DOL audit.
- The DOL typically provides little advance notice of an audit. However, you can request time to gather records. Typically, the amount of time an employer will have will depend on the auditor.
- Contact the auditor to find out specific information about the audit. Key questions to ask are the focus of the investigation (e.g., overtime pay compliance, exempt vs. nonexempt classification, minimum wage compliance), the time period for records the auditor wants to view, and the names of any employees that may be interviewed.
- Gather the records in accordance with guidance provided by the auditor. Be prepared to provide documentation related to the company compensation policies and procedures. Keep track of exactly what information was provided. Do not provide records other than what the auditor requests.
- Designate one or two company representatives to work with the auditor. Some employers choose to designate their company’s legal counsel; other employers will designate senior managers. The representatives will have the duty to provide documents requested, arrange for any additional records to be provided to the auditor (if necessary) and coordinate employee interviews.
- During the audit, be courteous to and cooperative with the auditor. It is a good practice to provide a quiet area for the auditor to work in.
- At the end of the audit, ask the auditor to provide a summary of the results of the investigation. This information will help an employer review options for resolutions if any violations are found. If violations are found, employers are encouraged to consult legal counsel before any settlements are reached with the DOL.
To be proactive, employers should consider a self-audit, which consists of the following steps:
- Review job descriptions.
- Understand the differences between federal and state laws and ensure that the laws are correctly applied to employees.
- Ensure that FLSA classifications are correct.
- Keep accurate payroll records.
- Apply policies consistently.
- Make sure all records are complete and work to resolve any inconsistencies.
- Determine how to address any areas of concern identified via the self-audit.
ACA Makes Tax Season Tougher For Small Companies
Original post insurancenewsnet.com
As more requirements of the health care law take effect, income tax filing season becomes more complex for small businesses.
Companies required to offer health insurance have new forms to complete providing details of their coverage. Owners whose payrolls have hovered around the threshold where insurance is mandatory need to be sure their coverage — if they offered it last year — was sufficient to avoid penalties.
Here are some of the issues related to the health care law that small businesses need to be aware of:
HOW MANY EMPLOYEES DO YOU HAVE?
Companies with 100 or more workers were required to offer affordable health insurance to employees and their dependents, but not their spouses, starting in 2015. Businesses with 50 to 99 workers must offer coverage starting this year; those with under 50 are exempt.
Owners who were on the hook for affordable insurance last year but didn't provide it may face thousands of dollars in penalties — $2,000 per employee per year, not counting the first 80 employees for the 2015 tax year, and the first 30 for 2016. So it's critical for them to know what their head count was — and many may not realize the calculations are based on a company's 2014 payroll, not 2015.
Here's where it gets complicated: Part-time workers and those fired during the course of the year can all be counted toward the threshold where coverage is required. So can some seasonal workers.
Part-timers work fewer than 30 hours a week under the health care law. They must be counted toward what are called full-time equivalent workers. If, for example, a company has two people who each work an average 15 hours a week, they count as one full-time equivalent employee working 30 hours. A company with 30 full-timers and 40 part-timers who average 15 hours a week each has 50 full-time equivalent workers and is required to offer insurance.
Another wrinkle: Owners with multiple companies that combined have 50 or more workers may be required to offer insurance, even if each of the individual companies has fewer than 50.
NEW TAX FORMS
Starting this year, businesses required to comply with the health care law must complete forms that detail the cost of their coverage and the names and Social Security numbers of employees and their dependents. The government will use the information to determine whether a company provided coverage that was affordable under the law, or whether it must pay a penalty.
Accountants have described the forms as labor-intensive, because they require information from a number of sources including payroll and health insurance records. Many companies have had to hire workers or payroll services to complete the forms.
The IRS, recognizing the forms' complexity, has extended the deadlines for the forms to be filed. Forms 1095-B and 1095-C, which must be given to workers, are now due March 31. Forms 1094-B and 1094-C, required to be filed with the IRS, are due by May 31 if they're not being submitted on paper, and June 30 if filed online.
WELL-INTENTIONED BUT ILLEGAL
Some employers with fewer than 50 workers and who don't offer insurance have tried to help staffers with the costs of coverage by giving them money toward their premiums, with the intention that the money will be tax-free. That could get owners into expensive trouble with the IRS — they can be fined $100 per day per employee receiving the money, a total of $36,500 per year for each worker.
The problem is that some employers treat this money as a health benefit, but it's not coverage that complies with the law. So they can be penalized.
Companies can help employees with their premium costs by giving them a raise or a more traditional bonus, says Mark Luscombe, a tax analyst with the business information company Wolters Kluwer. That means withholding income and what's known as payroll taxes — Social Security and Medicare — from employees' paychecks, and for companies to pay their payroll tax share.
Here are the top 10 most costly U.S. workplace injuries
Original post lifehealthpro.com
Workplace injuries and accidents are the near the top of every employer’s list of concerns.Here is the countdown of the top 10 causes and direct costs of the most disabling U.S. workplace injuries. The definitions and examples can be found at the BLS website.
- Repetitive motions involving micro-tasks
Some of these tasks may include a word processor who looks from the computer monitor to a document and back several times a day or the cashier at the local grocery store who is scanning and bagging groceries for several hours at a time.
- Struck against object or equipment
This category of workplace injury applies to workers who are hurt by forcible contact or impact, for example, an office worker who bumps into a filing cabinet or an assembly line worker who stubs a toe on stacked parts.
- Caught in or compressed by equipment or objects
These workplace injuries result from workers being caught in equipment or machinery that’s still running as well as in rolling, shifting or sliding objects.
Picture the scene in a movie in which wine barrels topple over, catching the bad guy beneath them, only in this case, it’s the employee whose job it may be to stack the barrels. Perhaps it’s the experienced worker who removes a machine guard to dislodge material that’s stuck and gets a finger caught when the machine starts moving again.
- Slip or trip without fall
Occasionally, workers do slip or trip without hitting the ground. Think of the employee entering the workplace who slips on icy stairs but is able to grab the handrail to prevent hitting the ground. But the action of grabbing the handrail may cause the employee to injure his shoulder or wrench her knee.
- Roadway incidents involving motorized land vehicle
The worker may be the driver, a passenger or a pedestrian, but the cause of the injury is an automobile, truck or motorcycle.
- Other exertions or bodily reactions
These motions include bending, crawling, reaching, twisting, climbing or stepping, according to the BLS. Consider, for example, a roofing contractor’s employees who are continually climbing up and down ladders.
- Struck by object or equipment
This category covers a range of possible injuries, from being struck by an object dropped by a fellow worker to being caught in a swinging door or gate. Picture the construction worker on a scaffold dropping a hammer on the worker below.
- Falls to lower level
The roofer could fall to the ground from the roof or ladder, or an office worker standing on a stepstool, reaching for a heavy file box, could fall to the floor.
- Falls on same level
The second most costly workplace injury, surprisingly, is a fall on the same level. Picture the employee who is walking through the office and falls over an uneven floor surface or someone leaning too far back in an office chair and toppling over.
- Overexertion involving an outside source
The BLS explains that overexertion occurs when the physical effort of a worker who lifts, pulls, pushes, holds, carries, wields or throws an object results in an injury.
The object being handled is often heavier than the weight that a worker should be handling or the object is handled improperly. For example, lifting from a shelf that’s too high, or in a space that’s cramped. Within the broad category of sprains, strains, and tears caused by overexertion, most incidents resulted specifically from overexertion in lifting.
Risk managers should work with their carriers and workplace safety specialists to minimize injuries, lost work days and workers’ compensation costs.With a little effort, employers can understand more about the causes of accidents and injuries in their organizations, identify the appropriate actions to reduce the number of injuries and minimize employee disabilities from workplace accidents.
4 retirement trends to watch in 2016
Original post benefitspro.com
The Institutional Retirement Income Council has announced the top four retirement industry trends to watch in 2016.
- Financial wellness plans.
According to IRIC, financial wellness will be a big one.
Employers are expected to significantly expand wellness programs that currently focus on physical wellbeing so that they also include features focusing on financial wellbeing.
With all the financial challenges faced by employees—including medical expenses, credit card debt, college expenses, and retirement planning—financial wellness programs have been growing increasingly popular, with that trend expected to continue in the year ahead.
A 2014 Society for Human Resource Management survey reported that 70 percent of HR professionals predicted that baby boomers would likely participate in a financial wellness program if their employer offered one.
Such programs will likely include not just ways to manage debt and better save for retirement, but also how to calculate a spend-down plan once in retirement and how to incorporate Social Security into one’s overall strategy.
- Out of plan or in plan?
Next is the trend that pits out-of-plan income solutions against in-plan solutions.
In their quest to be sure that retirement savings will provide a regular source of income throughout retirement, participants have been looking outside of their retirement plans to find ways to translate a lump sum into a monthly check.
However, the Department of Labor’s expected implementation of a fiduciary rule will have a major effect on out-of-plan advisors, as well as in-plan options.
The release of a Center for Retirement Research study that showed IRAs’ rate of return a poor substitute for that of defined benefit plans will, according to IRIC, “make it all the more difficult for advisors to recommend moving out of a defined contribution plan to those eligible to keep their assets in the plan.”
As a result, it expects that participants will be more likely to leave their assets in a retirement plan rather than rolling them over.
- In-plan retirement income solutions.
The move to keeping assets inside retirement plans, IRIC said, “should cause an increase in participant interest in investment vehicles that provide solutions to the draw-down, rather than accumulation, of retirement assets.”
As a result, revisiting in-plan retirement income solutions will become a major focus for plan sponsors in 2016.
IRIC said that plans that have not considered this will be under pressure from participants to “consider new solutions to address the risks of retirement income sustainability, longevity risk, market timing risk and in-plan distribution options.”
- In-plan distribution flexibility.
Plan sponsors will have to consider the question of which distribution options will be available to terminated participants.
If a plan only offers two options—complete lump-sum distribution or keeping the entire balance in the plan—it’s likely that sponsors will want to explore the possibility of offering periodic withdrawal opportunities, so that they can encourage terminated participants to keep their assets in the plan—which can provide benefits not only to the participants, but also to the plan itself in the form of reduced administration and fee costs.
What employees need to know now to file tax forms for PPACA
Original post benefitspro.com
The Patient Protection and Affordable Care Act (PPACA) reporting deadlines are rapidly approaching, presenting a major administrative burden for employers who face penalties for failing to report in a timely and accurate manner.
While there has been significant discussion of employer roles and responsibilities, employees have been largely left out of the equation.
However, many employees will soon be receiving new forms that are critical to their ability to file their tax returns and to their employers’ ability to accurately fulfill their own reporting requirements. Among these are Forms 1095-A, 1095-B, and 1095-C.
With this in mind, it is important for employers to educate individual taxpayers on what they are required to do and when and how to complete these requirements in the easiest and most efficient manner.
1095-C
The most commonly received form will be the new 1095-C, which millions of Americans will be receiving for the first time this year.
This new government form is used to tell the Internal Revenue Service that you were eligible for insurance coverage under the Affordable Care Act and whether you took advantage of or waived this coverage.
This form will be sent by employers no later than March 31 to all eligible full-time employees who worked for a company with a total of 100 or more full-time or full-time equivalent employees in 2015. For the purposes of this form, full-time is any employee working 30 or more hours per week or 130 hours in a calendar month.
According to the IRS guidance, Form 1095-C helps to determine whether both the employer and the employee have complied with the “shared responsibility” clause of the ACA.
The form also determines whether an individual or family qualifies for the Premium Tax Credit, which reduces the burden of purchasing health insurance.
Anyone who does not have coverage elsewhere and chose to decline employer-sponsored health care coverage will be required to pay a penalty for not carrying coverage--this penalty will be assessed on their tax return.
For 2015, the penalty for declining all health care coverage is $325 per uninsured adult and $162.50 per uninsured child or 2 percent of household income, whichever is greater up to a family maximum of $975.
The penalty will increase to $695 per uninsured adult and $347.50 per child or 2.5 percent of household income up to a family maximum of $2,085 in 2016, and will continue to rise with inflation year-over-year.
However, the IRS offers special exemptions based on income, circumstance and membership in certain groups, so those without coverage should research their options or consult a tax professional. (The most common exemption is for those who declined employer-sponsored coverage that would have cost more than 8 percent of their total household income.)
Health care exemptions can be claimed by filing IRS form 8965 with your taxes. As previously noted, the form also determines who may be eligible for premium credits to help defray the expense of coverage.
Employers are required to submit insurance coverage information, along with social security numbers and other identifying employee information to the IRS, and employee failure to disclose a waiver of coverage may result in an audit and penalties greater than the ACA individual mandate penalty.
1095-B
Form 1095-B essentially serves the same purpose as form 1095-c, but is used by and sent to employees of companies with fewer than 100 employees.
It may also be sent directly by an insurer to certify that individuals/families had non-employer sponsored coverage in place in 2015. This coverage may have come from:
- Government health care plans such as Medicare Part A, Medicare Advantage, Medicaid, the Children's Health Insurance Program, and Tricare for military members, veterans’ medical benefits and plans for Peace Corps volunteers.
- Health coverage purchased through the "Marketplace" -- Web-based federal and state insurance markets set up under the Affordable Care Act.
- Any individual health insurance policy in place before the Affordable Care Act took effect.
Depending on the way a health care plan is structured, some employees may receive both a 1095-B and a 1095-C.
1095-A
Form 1095-A is only applicable to those who purchased their health care coverage through ACA’s health care exchanges.
This form plays a critical role in reconciling the Advanced Premium Tax Credits (also known as APTCs)--a yearly stipend based on modified adjusted gross income designed to help lower-income individuals and families defray the cost of purchasing exchange-based health insurance--for 2015 and in determining future credits for 2016.
Per IRS and ACA requirements, any excess APTC received in the previous year must be repaid through income tax.
What to do with these forms
Like the more familiar W-2 or 1099 forms, the 1095-A, B, and C will be needed to file a 2015 tax return for anyone who receives it.
Those using a tax preparer will need to bring it with them along with their other filing documents, and those doing their own taxes or using tax preparation software will need to keep this document with their tax records in case of any further inquiry /audit by the IRS.
Help is available
Of course, this is just one important factor in gaining a more thorough understanding of the complexities of the ACA. While the IRS has worked to streamline the process as much as possible, many employers and employees are struggling to understand and keep pace with changing requirements.
However, for quick questions, there are many good resources available to both employers and employees. One of the best is the IRS website.
As in all tax-related issues, the most important factors in handling ACA reporting for all groups are to know what’s coming, prepare in advance, keep excellent records, take note of deadlines and avail yourself of helpful resources.