ACA IRS e-filing Process Improvements to Reduce Errors and Exposure to IRS Penalties

ACA IRS e-filing Process Improvements to Reduce Errors and Exposure to IRS Penalties


 New BenefitScape software improves e-filing process…while traditional “tax filers” lag behind!

The IRS has announced that the Tax Year 2018 AIR Production for Tax Year 2018 will go-live at approximately 9 a.m. Eastern time on Tuesday, January 15, 2019. Once IRS AIR is live it will also accept data on prior years’ filings and corrections. IRS AIR is the Affordable Care Act Information Returns system.

Getting ready for IRSAIR e-filing, a very important final step in ACA compliance, has evolved over the last few years and BenefitScape has been constantly improving the process so that it is highly accurate and reduces exposure to unnecessary penalties.

BenefitScape is an authorized IRS AIR Transmitter. We have helped employers comply with the ACA by e-filing millions of IRS records using our ACATech technology. We have been working with hundreds of clients in the three years of existence of the ACA e-Filing process, so we’ve built up a wealth of information concerning how to prepare correct filings.

BenefitScape deploys proven business processes along with our intelligent technology to deliver IRS AIR e-filing integration that is truly seamless and painless for our clients. Our market-leading, cloud-based ACATech platform allows us to quickly and accurately follow every step in the IRS process with the precision that the task demands. This diligence and technology -assisted approach enables us to help our clients avoid unnecessary IRS penalties. In particular we bring several process improvements to IRS filing such as:

  • TIN Validation-before actual e-filing-to Reduce Work on Unnecessary Corrections
  • Penalty Assessment and Pre-Filing Validation ensures correct acceptable IRS coding for lines 14 to 15 and 16 on form 1095C.
  • Automated correction assistance-if the IRS produces any errors these can be corrected using our automated platform.

Not all IRS “e-filers” approach the filing with the proper level of diligence or technology assistance

The BenefitScape approach is in sharp contrast to what many traditional IRS “tax filers” have been doing in the last few years. Essentially these W-2 and 1099 preparers will take the ACA data, unedited on behalf of the filing employer and present it to the IRS AIR system. This approach, while adequate for W-2 and 1099 –because they are largely arithmetic functions– is woefully inadequate when it comes to form 1095c filing. We know this because we have seen the results of unedited e-filings,  primarily unnecessary ACA IRS penalties that need to be reconciled with the IRS at great expense and time consumption by the affected employer. Why does this gap exists? First, all tax filing is not the same. Experience in one area does not mean experience in all. BenefitScape is a specialist in ACA e-filing and we have the technology and expertise to do it effectively.

BenefitScape Uses TIN Validation to Reduce Work on Unnecessary Corrections

Our ACATech platform is Smart, Fast and Secure, enabling us the IRS’ TIN validation process to ensure that employee and dependent social security numbers are valid and will be accepted by the IRS. The result is a dramatic decrease in the number of IRS corrections that are required and significantly reducing clients’ follow up efforts.

Our Penalty Assessment and Pre-Filing Validation Reduce Needless IRS Penalties for Clients using our “Full Service” and Our “e-file Only” Offering.

The IRS has issued Billions of Dollars in Employer Shared Responsibility penalties since the start of 2018, and these were only for Tax Years 2015 and 2017. Many billions more are expected to be issued this year. The BenefitScape ACATech system Penalty Assessment module give employers a view into projected penalties, highlighting IRS codes that can be corrected before filing with the IRS. This has reduced the potential IRS liability for many of our clients.

Pre-Validation Reduces IRS Transmission Cycles and Corrections

After we’ve validated SSN’s and completed the remediation of the penalty assessment review, it’s time to get the filing ready for the AIR system. BenefitScape pre-validates the information that will be sent to the IRS to certify that it is correct. If pre-validation errors exist, the IRS provides error notifications, and ACATech correction tools fix the problem. 

After we have completed each of these steps the actual e-filing via IRS AIR occurs. The data will then go through the IRS validation process and the e-filing is accepted, and reporting is complete. Of course, there may be additional corrections that come of the final e-filing, but these will have been minimized by the steps described above!


The IRS Affordable Care Act Information Returns system is the IRS interchange for ACA filings. It collects, stores and reports on the hundreds of millions of 1094 B/C and 1095 B/C annually. The AIR system is the source system for the Employer Shared Responsibility Payment (ESRP) Notices (aka: Sec. 4980 Penalties) in 2018, and it will continue to be. BenefitScape is intimately familiar with these Notices and has helped organizations contest millions of dollars in unnecessary penalties.

The IRS AIR system has made great strides in the past three years, but the fact remains that, e-filing is a complex process. Organizations still must ensure that they follow each step in the process carefully, perform all the pre-filing validations, have expertise in XML and IRS correction nomenclature and execute each step timely for success.

News & Latest Posts

Sal Vergara Joins BENEFITSCAPE as VP for Channel Partnerships

July 10, 2024

BENEFITSCAPE has appointed of Sal Vergara as Vice President for Channel Partnerships….

HCMs Arrive at Parity with Best-in-Class Ben Admin Solutions

July 1, 2024

By BENEFITSCAPE CHAIRMAN Ken Phillips ________________________________________________________________ INTRODUCTION Alongside Human Capital Management [HCM]…

PCORI Guide & 30-Second Checklist

June 13, 2024

WHAT IS PCORI? PCORI stands for Patient-Centered Outcomes Rsearch Institute. The acronym…

A Response To IRS Call for ACA Feedback

June 11, 2024

By BENEFITSCAPE CHAIRMAN Ken Phillips ________________________________________________________________ The IRS has invited feedback on…

ACA Filing Errors: What To Do Next

May 13, 2024

You met the IRS reporting deadline. But now it’s time to correct…

Late Filings & Other Timely ACA Tips

May 9, 2024

Now that the April IRS deadline for ACA reporting has come and…

Scroll to Top