[Congressional Record Volume 169, Number 108 (Wednesday, June 21, 2023)]
[House]
[Pages H3048-H3050]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
{time} 1900
EMPLOYER REPORTING IMPROVEMENT ACT
Mr. SMITH of Missouri. Mr. Speaker, I move to suspend the rules and
pass the bill (H.R. 3801) to amend the Internal Revenue Code of 1986 to
streamline and improve the employer reporting process relating to
health insurance coverage and to protect dependent privacy, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 3801
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Employer Reporting
Improvement Act''.
SEC. 2. TIN REPORTING FLEXIBILITY.
(a) In General.--Section 6055(b)(1) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
flush sentence:
[[Page H3049]]
``For purposes of subparagraph (B)(i), in the case of any
individual whose name is required to be set forth in a return
under subsection (a), if the person required to make a return
under such subsection is unable to collect information on the
TINs of such individuals, the Secretary may allow the
individual's full name and date of birth to be substituted
for the name and TIN.''.
(b) Effective Date.--The amendment made by this section
shall apply to returns the due date for which is after
December 31, 2024.
SEC. 3. ELECTRONIC STATEMENTS.
(a) In General.--Section 6056(c) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
new paragraph:
``(3) Electronic delivery.--An individual shall be deemed
to have consented to receive the statement under this
subsection in electronic form if such individual has
affirmatively consented at any prior time, to the person who
is the employer of the individual during the calendar year to
which the statement relates, to receive such statement in
electronic form. The preceding sentence shall not apply if
the individual revokes such consent in writing.''.
(b) Statements Relating to Health Insurance Coverage.--
Section 6055(c) of the Internal Revenue Code of 1986 is
amended by adding at the end the following new paragraph:
``(3) Electronic delivery.--An individual shall be deemed
to have consented to receive the statement under this
subsection in electronic form if such individual has
affirmatively consented at any prior time, to the person
required to make such statement, to receive such statement in
electronic form. The preceding sentence shall not apply if
the individual revokes such consent in writing.''.
(c) Effective Date.--The amendments made by this section
shall apply to statements the due date for which is after
December 31, 2024.
SEC. 4. TIME FOR RESPONSE.
(a) In General.--Section 4980H(d) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
new paragraph:
``(4) Time for response.--The Secretary shall allow an
applicable large employer at least 90 days from the date of
the first letter which informs the employer of a proposed
assessment of the employer shared responsibility payment
under this section to respond to the proposed assessment
before taking any further action with respect to such
proposed assessment.''.
(b) Effective Date.--The amendment made by this section
shall apply to assessments proposed in taxable years
beginning after the date of the enactment of this Act.
SEC. 5. STATUTE OF LIMITATIONS ON PENALTY ASSESSMENT.
(a) In General.--Section 6501 of the Internal Revenue Code
of 1986 is amended by redesignating subsection (n) as
subsection (o) and by inserting after subsection (m) the
following new subsection:
``(n) Assessable Payment of Employer Shared
Responsibility.--In the case of any assessable payment under
section 4980H, the period for assessment shall expire at the
end of the 6-year period beginning on the due date for filing
the return under section 6056 (or, if later, the date such
return was filed) for the calendar year with respect to which
such payment is determined.''.
(b) Effective Date.--The amendment made by this section
shall apply with respect to returns which are due after
December 31, 2024.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Missouri (Mr. Smith) and the gentleman from California (Mr. Thompson)
each will control 20 minutes.
The Chair recognizes the gentleman from Missouri.
General Leave
Mr. SMITH of Missouri. Mr. Speaker, I ask unanimous consent that all
Members have 5 legislative days to revise and extend their remarks and
submit extraneous material on the bill under consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Missouri?
There was no objection.
Mr. SMITH of Missouri. Mr. Speaker, I yield myself such time as I may
consume.
I appreciate the opportunity to say a few words about the Employer
Reporting Improvement Act before us today, introduced by my good
friends, Ways and Means colleagues, Representatives Adrian Smith and
Mike Thompson. This is a straightforward and effective bipartisan
solution to provide small businesses with relief from cumbersome
Affordable Care Act reporting requirements.
Under current law, every year, to determine compliance with ACA
requirements, employers have to report to the IRS information about the
health insurance coverage they have provided for their employees.
As part of that process, employers are required to submit their
employee and their spouse or dependents' personal tax identification
numbers or Social Security numbers. However, here is the catch: If,
during this process, the employer unknowingly submits incorrect
information, or if the IRS believes that an employee is wrongfully
claiming a premium tax credit, the employer faces a significant
financial penalty.
Making matters worse, the window of opportunity that employer has to
appeal is short, while the statute of limitations on that violation is
limitless.
On average, the IRS takes anywhere between 18 to 24 months, 2 years,
to crunch the numbers on all this data they receive. That means the
small business is left in limbo waiting to hear whether the government
will find them in violation of the law.
The bill before us today gives employers flexibility about what
personal information they have to provide on behalf of their employees
and their families. It extends the appeal window for any potential
violation and establishes a statute of limitations so those small
businesses, who have limited resources to begin with, can navigate
these waters with less of a burden.
I thank my colleagues on both sides of this aisle for supporting this
measure to provide relief to our small business job creators.
Mr. Speaker, I reserve the balance of my time.
Mr. THOMPSON of California. Mr. Speaker, I yield myself such time as
I may consume.
I rise in strong support of this legislation. I thank my colleague
from Nebraska and my friend, Mr. Smith, for working with me on this
important bill.
This legislation before us today simplifies the ACA reporting process
for employers and businesses across our country. The bill allows
employers to submit required information electronically and improves
privacy protections by eliminating the unnecessary requirement that
employers collect dependents' Social Security numbers.
In addition, the bill ensures that employers have a reasonable
opportunity to respond to the IRS before being assessed penalties,
while simultaneously ensuring the IRS has the time and tools it needs
to assess penalties to bad actors.
I share my colleagues' disappointment that prospective reporting
provisions of the bill were removed. I understand the challenges facing
the Treasury Department, and I look forward to working with my
colleagues toward a resolution on that front.
Mr. Speaker, I reserve the balance of my time.
Mr. SMITH of Missouri. Mr. Speaker, I yield 3 minutes to the
gentleman from Nebraska (Mr. Smith), one of the sponsors of this
legislation.
Mr. SMITH of Nebraska. Mr. Speaker, I rise today in support of our
bill, the Employer Reporting Improvement Act. As was mentioned, the
bill was adapted from legislation that my colleague, Mr. Thompson, and
I have been working on for years, the Commonsense Reporting Act.
The Employer Reporting Improvement Act is a strong step toward
cleaning up the complicated process employers use to report data
required by the IRS and providing employers relief.
This data is used to determine if an employee's health coverage is
considered affordable. Unfortunately, an inadvertent mistake or
omission in reporting this data can result in a financial penalty for
the employer long after the original submission. The potential
financial penalty can put a serious strain on small businesses who are
already struggling with workforce shortages and persistently high
inflation.
While the vast majority of these mistakes are ultimately corrected
without a financial penalty being enforced, employers are still forced
to navigate a complicated maze of bureaucracy to clear up these
unintentional mistakes.
The Employer Reporting Improvement Act makes simple, yet effective
changes, including codifying actions previously taken to create more
safeguards and flexibilities, improving the reporting process, and
making it less likely employers are faced with resolving reporting
problems several years after the fact.
In fact, one of the most important pieces of the bill is the creation
of a reasonable statute of limitations, 6 years, for penalties
resulting from reporting errors.
As we continue our work to improve employer reporting requirements, I
hope we can work with the Treasury Department to find a path forward on
prospective reporting, as Mr. Thompson also elaborated on.
I am glad to support the Employer Reporting Improvement Act. I
encourage my colleagues to do the same.
[[Page H3050]]
Mr. THOMPSON of California. Mr. Speaker, I reserve the balance of my
time.
Mr. SMITH of Missouri. Mr. Speaker, I am prepared to close. I reserve
the balance of my time.
Mr. THOMPSON of California. Mr. Speaker, I yield myself the balance
of my time.
I reiterate my thanks to my partner on this bill, Mr. Smith from
Nebraska. This is a bill that I have worked on for the last four
Congresses. It will make life easier for businesses, and I urge my
colleagues to support it.
Mr. Speaker, I yield back the balance of my time.
Mr. SMITH of Missouri. Mr. Speaker, I yield myself the remainder of
my time.
America's small businesses have had it pretty tough these past few
years. They are asking that Congress do its part to bring a measure of
relief.
The Employer Reporting Improvement Act is one step we can easily take
to shrink the burden Washington imposes on them and their employees.
The mom-and-pop shops that line America's Main Streets should not
have to operate under fear that Washington is going to come after them
for a clerical error. When they are faced with a potential penalty,
they ought to have the time to make their case. It is a simple matter
of fairness.
This measure has strong bipartisan support. It sailed out of the Ways
and Means Committee on a vote of 37-0.
I urge my colleagues to support this legislation, and I yield back
the balance of my time.
The SPEAKER pro tempore (Mr. Nunn). The question is on the motion
offered by the gentleman from Missouri (Mr. Smith) that the House
suspend the rules and pass the bill, H.R. 3801, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
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