November 10, 2026

 ACA Reporting Mistakes: 6 Tips for Employers (2027)

6 Tips to Avoid Common ACA Reporting Mistakes in 2027

Employers have had to meet Affordable Care Act (ACA) reporting rules for more than a decade, and the process is still complex. Even experienced HR and benefits teams get caught by the details, and mistakes can lead to costly IRS penalties.

To start, the IRS recommends that employers:

  • Prepare returns with accurate information.
  • File information returns electronically by the March 31, 2027, deadline.
  • Request a waiver from electronic filing, if needed.
  • Apply for an extension, if needed, and file by the extended due date.

The tips below cover the errors we see most often and how to prevent them.

Tip 1: Make sure your legal company name matches your EIN

Your company’s legal name, as shown on official documents like tax filings or incorporation papers, must match the Employer Identification Number (EIN) on every reporting form. Fix any mismatch before you file with the IRS so you don’t face penalties for inaccurate reporting.

Tip 2: Account for every member of an Aggregated ALE Group

Companies under common control form an Aggregated ALE Group. Each ALE member in the group must:

  • File Forms 1094-C and 1095-C with the IRS under its own EIN
  • Furnish Form 1095-C to its own full-time employees

This applies even if one member has fewer than 50 full-time employees on its own. If all the group’s members together averaged 50 or more full-time employees (including full-time equivalents) on business days during the prior calendar year, the whole group is an ALE, and every employer in it is an ALE member.

Common mistake: Smaller companies often don’t realize they have reporting obligations because they belong to an Aggregated ALE Group. That can lead to significant penalties. Mergers and acquisitions during the year also need to be reflected accurately in your reporting.

Tip 3: Track full-time employee status all year

Knowing which employees are full time is central to the ACA’s employer shared responsibility rules (often called “pay or play”) and to reporting correctly.

What counts as full time under the ACA? For any calendar month, an employee who averages at least 30 hours of service per week, or 130 hours per month.

Your company may define full time differently for payroll or internal policies. For pay or play, though, you must offer coverage to employees who meet the IRS definition. ALEs report coverage for every month from January through December, so it’s important to track employee status all year.

There are two ways to determine full-time status:

  • Monthly measurement method: Measures status month by month.
  • Look-back measurement method: Measures status over a set period of time.

Using the wrong measurement period can lead to misclassified employees, missed offers of coverage and, ultimately, reporting errors.

Tip 4: Report offers of coverage correctly on Form 1095-C

Form 1095-C holds most of the information ALEs need to report, so it’s essential to understand it, especially the indicator codes on lines 14–16.

  • Fully insured plans: Complete one form for each full-time employee, even if you didn’t offer coverage to any full-time employees.
  • Self-funded plans: Complete a form for anyone who was covered, not just full-time employees.
Line 14: Offer of coverage (Code Series 1)
  • Enter a code for every calendar month, even months when the employee wasn’t full time. Never leave a month blank.
  • Enter the code for the type of coverage actually offered, if any.
  • If no coverage was offered, enter code 1H.
Line 15: Employee required contribution
  • This is generally the employee’s share of the lowest-cost monthly premium for self-only coverage offered to them. It may differ from what the employee actually pays, for example if they chose family coverage.
  • Leave line 15 blank if line 14 shows code 1A, 1F, 1G, 1H, 1R or 1S.
  • If coverage was offered and the employee’s required contribution is zero, enter “0.00.” Don’t leave it blank.
Line 16: Safe harbor codes (Code Series 2)
  • Enter only one Code Series 2 code per month, even if more than one could apply. Check the IRS instructions to choose the right one.
  • If no code applies, you can leave line 16 blank.
  • For employees who didn’t enroll in coverage, specific ordering rules apply, so review the code descriptions carefully.
  • There is no code that indicates a full-time employee declined or waived coverage.

Tip 5: Know the 2027 ACA reporting deadlines

RequirementDeadline (calendar year 2026)
Electronic filing with the IRSMarch 31, 2027
Post website notice (alternative furnishing) or furnish forms automaticallyMarch 2, 2027
Keep the website notice postedThrough Oct. 15, 2027
Fulfill individual requests for a formJan. 31, 2027, or 30 days after the request, whichever is later

Who must file electronically? Any reporting entity filing at least 10 returns during the calendar year.

Do employers still have to mail Forms 1095-B and 1095-C? Not automatically. Reporting entities can instead post a notice on their website saying individuals may request a copy. For calendar year 2026, the notice must:

  • Be clear, conspicuous and easy for all covered individuals to find
  • Include an email address, a mailing address for requests and a phone number
  • Be posted by March 2, 2027, and stay in the same place through Oct. 15, 2027

Tip 6: Don’t forget state reporting requirements

Employers in California, the District of Columbia, Massachusetts, New Jersey and Rhode Island must also meet state reporting requirements tied to each state’s individual mandate. Vermont has an individual mandate too, but no separate state reporting requirement right now.

Many state rules mirror federal ones, but federal changes, like the new alternative furnishing option, apply only at the federal level. When federal requirements change, check how the change affects your state obligations.

The Bright Side ☀️

ACA reporting is detailed, but it’s predictable. The same six areas account for most errors, so a little planning goes a long way. Confirm your EIN details, map out your ALE group, track employee hours all year and give yourself time before the March 31, 2027, deadline. Every accurate filing protects your organization from penalties and helps your employees trust their benefits.

You don’t have to figure it out alone. Daybright’s benefits team can help you get ready for reporting season.

Links and resources

This content is for general information only and isn’t legal advice. Please contact legal counsel for advice about your situation.

This post is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. Content sourced from Zywave.