Industry News

Employer Reporting Requirements under the ACA

Update 10/2/2020: The IRS extended the deadline for providing the statements to employees/individuals in 2021. No extension for the IRS filing deadlines.

Applicable Large Employers and all employers who offer self-funded plans are required to provide annual statements to employees and information returns to the IRS about the health coverage they offered (or did not offer) in the prior year. The IRS uses the statements and returns to confirm compliance with the employer and individual mandates and to administer subsidies in the individual market. Small employers who did not offer any coverage or only offered fully insured coverage are not subject to the reporting requirements summarized in this article. All other employers are.

The reporting is comprised of two forms: Employee Statements (Form 1095) and an IRS Transmittal (Form 1094). Employers send statements to each employee and file the statements with the IRS in conjunction with a the summary information transmittal.

Reporting Required from Large Employers

You are an Applicable Large Employer (ALE) if you averaged at least 50 full-time employees, including equivalent employees, during the prior calendar year. See Determining if an Employer is an Applicable Large Employer. ALEs use the C-series forms to report. ALEs who offered self-funded coverage complete Part III of each listing the employee and dependents covered by the plan and the period of the coverage. ALEs filing 250+ employee statements must file electronically.

Deadlines in 2021 for Reporting about 2020

  • Statements to Employees: Mar 2
  • Submission to the IRS: Mar 31 (if electronic) or Feb 28 (if paper)

Reporting Required from Small Employers about Self-Funded Plans

Small employers who offered self-funded coverage and are not ALEs are required to report about each employee and their dependents who were covered by a plan at any point in the year and the period of the coverage. Employers use the B-series forms.

Deadlines in 2021 for Reporting about 2020

  • Statements to Employees: Mar 2
  • Submission to the IRS: Mar 31 (if electronic) or Feb 28 (if paper)

In Notice 2020-76, the IRS acknowledged the individual mandate penalty is zeroed out beginning with the 2019 tax year and limited relief from penalties for failing to furnish employee statements is appropriate.  The IRS will not assess a penalty against entities for failing to furnish a Form 1095-B to individuals about their coverage in cases where the following two conditions are met:

  1. The reporting entity posts a notice prominently on its website stating that responsible individuals may receive a copy of their 2019 Form 1095-B upon request, accompanied by an email address and a physical address to which a request may be sent, as well as a telephone number that responsible individuals can use to contact the reporting entity with any questions.
  2. The reporting entity furnishes a Form 1095-B to any responsible individual upon request within 30 days of the date the request is received.

Additional Resources

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