What is an applicable large employer under the ACA?

An applicable large employer is one that averaged 50 or more full-time employees, including full-time equivalents, during the prior calendar year. ALEs are subject to the employer shared responsibility provisions. The calculation combines full-time headcount with equivalents derived from part-time hours.

How is coverage affordability determined?

Coverage is considered affordable if the employee's required contribution for self-only coverage does not exceed a set percentage of their household income, using an IRS-approved safe harbor. The percentage is adjusted annually. Offers that are unaffordable or fail minimum value can trigger penalties.

What ACA forms must employers file?

Applicable large employers must furnish Form 1095-C to full-time employees and file Forms 1095-C along with the transmittal Form 1094-C with the IRS. These report coverage offers and enrollment. Deadlines for furnishing and filing are set annually and carry penalties for lateness or errors.

Free ACA (Affordable Care Act) Compliance Checklist Checklist

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ACA (Affordable Care Act) Compliance Checklist

Employer Name:

Plan Year:

ALE Status:

Benefits Administrator:

ALE Status Determination

Calculate full-time equivalent (FTE) employees to determine ALE statusApply controlled group and affiliated service group aggregation rulesAssess seasonal worker exception eligibilityDocument ALE determination annually before the start of each plan yearMonitor monthly headcount for mid-year ALE status changes

Coverage Offer and Affordability

Offer minimum essential coverage (MEC) to at least 95 percent of full-time employeesEnsure the plan provides minimum value (MV) covering at least 60 percent of costsTest plan affordability using an IRS safe harbor methodOffer dependent coverage to all full-time employees' children up to age 26Apply the correct measurement, administrative, and stability periods for variable-hour employeesEnsure timely enrollment within the ACA waiting period limits

IRS Reporting (Forms 1094-C and 1095-C)

Prepare Form 1095-C for each full-time employeeApply the correct Line 14, 15, and 16 codes on Form 1095-CComplete Form 1094-C as the transmittal formFurnish Form 1095-C to employees by the IRS deadlineFile Forms 1094-C and 1095-C with the IRS by the filing deadlineFile electronically if submitting 250 or more Forms 1095-C

Penalty Exposure and Documentation

Monitor exposure to the Section 4980H(a) penalty for failure to offer coverageMonitor exposure to the Section 4980H(b) penalty for inadequate or unaffordable coverageRespond to IRS Letter 226-J penalty assessments promptlyMaintain documentation to support penalty relief and safe harbor claims

Benefit Mandates and Annual Review

Comply with ACA preventive care coverage mandates at no cost-sharingEliminate annual and lifetime dollar limits on essential health benefitsDistribute the Summary of Benefits and Coverage (SBC) to participantsReport the cost of employer-sponsored coverage on Form W-2Review ACA compliance annually and adjust for regulatory updates

The complete guide

Everything you need to know

01What Is the ACA Compliance Checklist?

The Affordable Care Act requires applicable large employers to offer affordable, minimum-value health coverage to full-time employees or face penalties. This checklist covers determining ALE status, tracking full-time and full-time-equivalent hours, testing coverage affordability, and completing the annual Forms 1094-C and 1095-C reporting to the IRS and employees. It keeps employer-mandate obligations organized and audit-ready.

02Why Use an ACA Compliance Checklist

ACA compliance hinges on accurate hours tracking and timely, correct reporting, and errors on Forms 1095-C or missed affordability tests can trigger IRS penalty assessments. Because ALE status depends on a full-time-equivalent calculation and offers must meet affordability thresholds that change yearly, the details matter. This checklist ensures you measure the workforce correctly, offer compliant coverage, and file complete forms on schedule.

03How to Use This ACA Compliance Checklist

First determine whether you are an applicable large employer by calculating full-time and full-time-equivalent employees. Track hours using a consistent measurement method, identify full-time staff, and confirm your coverage offer meets minimum value and the current affordability percentage. Prepare Forms 1095-C for employees and 1094-C for the IRS, distribute and file by the deadlines, and retain records. Tick each step per plan year.

ACA (Affordable Care Act) Compliance Checklist

ACA (Affordable Care Act) Compliance Checklist

ALE Status Determination

Coverage Offer and Affordability

IRS Reporting (Forms 1094-C and 1095-C)

Penalty Exposure and Documentation

Benefit Mandates and Annual Review

Everything you need to know

01What Is the ACA Compliance Checklist?

02Why Use an ACA Compliance Checklist

03How to Use This ACA Compliance Checklist

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