The Affordable Care Act, or ACA, is a sometimes complicated federal policy that governs which private companies must offer their employees health insurance policies, and what types must be offered. It also comes with many reporting requirements on companies of all sizes.

Every year, some of the requirements change, and 2025 is no different. In fact, President Joe Biden signed new bills late in December that seek to reduce the reporting burden on health insurance carriers and businesses alike.

Still, there are things employers must do to achieve 2025 ACA compliance. Below are some of the main changes to ACA compliance for 2025 that all employers need to pay attention to, as well as general requirements.

Tax Forms by Request Only

One of the main changes to the ACA is that employers aren’t required to distribute to all full-time employees what’s known as Form 1095-B and Form 1095-C. While companies have to notify all employees that they have a right to receive these forms by request, they don’t need to automatically distribute them.

Under the newly-signed Paperwork Burden Reduction Act, employees who request these forms must receive them within 30 days of the request or by January 31 or the following calendar year — whichever is later.

The newly-signed Employer Reporting Improvement Act also permits companies to distribute these forms electronically rather than by paper if the employee consents to it.

Flexibility with TIN

If an employer isn’t able to obtain an employee’s TIN, or taxpayer identification number, they can instead use that employee’s full name and date of birth for Form 1095-C. The penalties for not obtaining the TIN are now removed, thanks again to the new laws.

This removes a significant burden for some employers, who have had trouble obtaining this information for dependents who are considered non-resident aliens and don’t have a Social Security number or a reason to get a TIN.

Extended Response Deadline to Penalties

Another major change for 2025 ACA compliance is that employers will have at least 90 days to respond to penalty letters from the IRS. The previous deadline to respond to the 226-J letters was only 30 days.

This extended time will allow employers to adequately address any issues and correct them if need be before the penalties are officially assessed. This is key to some employers, as the issue could be as simple as a coding error.

In addition, a new statute of limitations of six years has been put into place for assessing and then collecting payments for the employer shared responsibility. This provides employers with more clarity about their potential liabilities as well as predictability in terms of cost.

What Health Coverage Must Be Offered?

In 2025, just like in previous years of the ACA, employers are required to offer health insurance that’s both affordable and provides minimum value to 95% of all full-time employees as well as their children, until they’re 26 years old.

Those who don’t provide that insurance can receive penalties from the IRS. This is what’s known as the ACA’s employer mandate.

This mandate applies to employers who have at least 50 full-time employees or what’s known as full-time equivalents (FTEs). People who work for the company at least 30 hours each week are considered to be full-time employees.

Health insurance is considered to be affordable according to the ACA if contributions employees make don’t exceed a percentage of their household income. For 2025, that number is 9.02%.

A health insurance plan is also considered to provide minimum value if the plan pays 60% or more of the total cost for all covered services, including all copays, coinsurance and deductibles.

What Penalties Do Companies Face for Non-Compliance?

Employers who don’t offer a health insurance plan, or don’t offer at least one plan that provides both affordable and minimum value coverage, can be subject to penalties. These penalties kick in if any of the company’s full-time employees purchase health coverage on the healthcare marketplace and receive a premium subsidy from the federal government.

Qualified employers who don’t offer any health coverage at all can be subject to a penalty of $2,570 for every full-time employee, minus the first 30.

Companies that offer a plan that doesn’t provide minimum value, or that isn’t deemed affordable, can be subject to a penalty that’s either $3,860 for every full-time employee who receives a federal subsidy or $2,570 for every full-time employee minus the first 30 — whichever is less.

Get ACA Compliant in 2025 with Beckham Ellis Insurance Group

The ACA has many mandates for employers in regard to health insurance coverage that’s offered to employees, as well as reporting requirements. These mandates and requirements change every year, making it challenging to understand what must be done.

That being said, getting in compliance with ACA is essential for all employers to avoid hefty penalties. That’s why working with an experienced health benefits company to ensure ACA compliance is key.

At Beckham Ellis Insurance Group, we can help your company create a health benefits plan that’s not only ACA compliant but that is attractive to current and prospective employees — helping you to stand out from your competition when it comes to recruiting and retaining top talent.

If your business is in the Georgia or South Carolina region, contact us today to learn more.