Skip to content

General education, not advice for your situation.

Carry Forward Learning Start here Intern0 XP

IRS notice decoder · Business accounts and employer notices

LTR 226-J: the IRS proposes an employer shared responsibility payment

Letter 226-J proposes an employer shared responsibility payment under the health care law. It isn't a bill. Respond with Form 14764 by the date in the letter.

By the Carry Forward Learning team Reviewed by Hunter Nottingham, JD, CPA

No dated figures Checked Review by

CheckedOct 19, 2026

What a LTR 226-J means

Letter 226-J is the first letter the IRS sends an applicable large employer (an ALE) to say it may owe an employer shared responsibility payment, or ESRP, under section 4980H. source 1 source 2

It is a proposal, not a bill, the IRS says. The figure comes from the Forms 1094-C and 1095-C the employer filed and from employees' own returns that claimed the premium tax credit. source 1

So the first thing we'd check is the reporting itself. If a Form 1095-C showed the wrong offer of coverage, or an employee who wasn't full-time, the proposed payment can be wrong too, and this letter is the moment to say so.

The date that counts

Return the response form and any supporting documents by the response date printed in the letter. The IRS says to use the contact information in the letter if you need more time. source 1

Why people get one

  • At least one full-time employee was allowed a premium tax credit for a month, and the employer's Forms 1094-C and 1095-C didn't show an offer of affordable, minimum-value coverage for that month. source 1
  • Coding errors on Form 1095-C are a common cause: a missing code or a wrong one can look like no offer of coverage.

First steps

  1. Read the letter and its attachments closely; the IRS says they explain the process and how the figure was worked out. source 1
  2. Check the Forms 1094-C and 1095-C you filed for that year against your payroll and benefits records. source 1
  3. If you agree, sign Form 14764 (the ESRP response form) and send it with payment, as the letter instructs. source 1
  4. If you disagree, explain why on Form 14764 and mark the changes on Form 14765 (the employee premium tax credit list), then return everything by the response date. source 1
  5. If someone will deal with the IRS for you, send Form 2848. The IRS says it must name the year and state that it covers the section 4980H shared responsibility payment. source 1

What not to do

  • Don't treat it as a bill and simply pay without checking the employee list. The proposal is built from your own filings and theirs.
  • Don't miss the response date. The IRS says the letter explains what to do and by when. source 1
  • Don't pay through a link or phone number in an unexpected email or text. Use irs.gov, typed in yourself.
  • Can come next CP220J The notice that bills the payment once it is charged.

Keep reading

Questions

Is Letter 226-J a bill?

No. The IRS calls it the initial proposal of the employer shared responsibility payment. source 1

Where did the IRS get the numbers?

From the Forms 1094-C and 1095-C the employer filed and from the individual returns of full-time employees, to see whether they were allowed a premium tax credit. source 1

What happens after I respond?

The IRS replies with an acknowledgement letter giving its final determination. source 1

Do I have appeal rights?

Yes. The IRS says the acknowledgement letter sets out your rights, including the right to appeal. source 1

Sources

  1. IRS, Understanding your letter 226-J (external site) checked Oct 19, 2026
  2. 26 U.S.C. § 4980H (Cornell LII) (external site) checked Oct 19, 2026

Every rule on this page comes from the IRS page in the list, read on the date shown. Your notice itself is the final word on its own dates and amounts.