It this a "it worked before but not now" or "it never worked before" issue?
On what computer operating system is your Premiere Elements 12/12.1 running? Have you updated 12 to 12.1 yet using an opened project's Help Menu/Updates? If not, please do that.
Right now the immediate question is "Do you have the latest version of QuickTime installed on your computer along with Premiere Elements 12/12.1? That is a must do. And, are you running your programs as administrator?
What are the properties of your source file? Mpeg is just the file extension. What are the video compression and audio compression in the file? What is the brand/model/settings of the camera that recorded the video?
All may be settled with a QuickTime install if it is not already installed.
Let us start with the above and then decide what next based on the details of your reply.