Employer Reporting Improvement Act

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.

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.

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. Speaker, I yield 3 minutes to the gentleman from Nebraska (Mr. Smith), one of the sponsors of this legislation.

Mr. Speaker, I am prepared to close. I reserve the balance of my time.

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.

Mr. Speaker, I rise today in support of H.R. 3801, the Employer Reporting Improvement Act.

This bill streamlines reporting requirements for small businesses when it comes to health insurance coverage information.

This bill will reduce administrative burdens and make it easier for businesses to comply with the Affordable Care Act.

More specifically, it permits employers to electronically file certain documents related to employees' health coverage if the employee has previously agreed to electronic statements.

The bill further streamlines reporting by allowing employers the option to use covered individuals' full name and date of birth if the employer is unable to collect the covered individuals' taxpayer identification number.

Currently, small businesses can be left in limbo by the IRS, sometimes for years, without knowing whether they correctly filed their health insurance coverage information.

The Employer Reporting Improvement Act reins in the IRS' ability to penalize American small businesses and gives them peace of mind that they won't be unfairly hit with a penalty.

Thanks to these streamlined procedures, small businesses will now have more time to focus on running their business, providing opportunities for their employees, expanding their business, and serving their customers.

In my home district of Houston, nearly 97 percent of the region's businesses are considered small businesses.

These small businesses employ 44 percent of the region's workforce, over 1.2 million employees across the city of Houston.

These small businesses continue to rise as over 150,000 new business applications were filed across Houston last year.

The city ranks 10th nationally in new businesses per capita and these businesses continue to drive the city's economic growth upwards.

Further, nearly 35 percent of these small businesses with 50 or fewer employees are minority-owned and Houston ranks 5th in the nation for minority entrepreneurship.

Small businesses are not only vital for Houston, but for our entire nation.

Across America, small businesses account for over fifty-nine million jobs, constituting nearly half of the national workforce.

Overall, they generate one third of all U.S. business revenue, approximately 13.7 trillion dollars annually.

This bill helps to relieve the burdens of complex paperwork and uncertainty on these small businesses and best equips them for success in Houston and across the nation.

I urge my colleagues to join me in supporting H.R. 3801 and in supporting small businesses by streamlining reporting processes.

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.

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. Speaker, I reserve the balance of my time.

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. President, I ask unanimous consent the Committee on Finance be discharged from further consideration of H.R. 3801 and the Senate proceed to its immediate consideration.

I further ask unanimous consent that the bill be considered read a third time and passed and the motion to reconsider be considered made and laid upon the table.