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Updated 3/8/2017

2016 ACA Reporting Deadlines

By now, applicable employers should have furnished Forms 1095-C or 1095-B (if plan is self-insured) to employees.  The deadline for distribution was 3/2/2017.

The next and final step in the ACA reporting process is the filing of Forms 1094-C/1095-C or 1094-B/1095-B with the IRS.  For employers that filed via paper, the deadline was 2/28/2017.  Employers that are e-filing, (which is required for employers filing 250 or more forms), must file by 3/31/2017.

 


 

Updated 1/11/2017

 

2016 ACA Reporting Deadlines

 

Applicable employers should be prepared to meet the upcoming ACA reporting deadlines:

  • 3/2/2017 – deadline to furnish Forms 1095-C or 1095-B (if plan is self-insured) to employees
  • 3/31/2017 – deadline to e-file Forms 1094-C/1095-C or 1094-B/1095-B with the IRS (if paper filing, the deadline is 2/28/2017)

Please note that the IRS has also extended the good-faith relief from penalties for inaccurate or incomplete information, so long as the employer can demonstrate that it made a good-faith effort to comply with the rules.  However, employers that fail to timely file the forms may still be subject to penalties.

Employers who are not completing the reporting internally and are not yet set up with a vendor should contact Sequoia immediately to ensure a vendor is able to assist with timely filing of the forms.

 


 

Updated 10/5/2016

 

IRS Releases Final ACA Reporting Forms for 2016

 

The IRS has released the final 2016 ACA reporting forms, as well as the final instructions.  Minor changes were made from the 2015 forms, including two new “Offer of Coverage” codes on the Form 1095-C to denote conditional offers of coverage to spouses.  The instructions have also been expanded to provide additional clarification in certain sections.

 

The final 2016 forms and instructions can be found at the links below.

 

 


 

Updated 8/12/16

 

IRS Releases Draft ACA Reporting Forms for 2016

 

The IRS has released drafts of the 2016 ACA Reporting forms, as well as instructions.

 

Below are a summary of the changes from the 2015 forms.

 

Changes to Form 1094-C

  • Part II, line 22, box B is marked as “Reserved”

 

Changes to Form 1095-C

  • Part II, line 14 – Code 1I, which was previously used to indicate Qualifying Offer Transition Relief is now reserved. Two new codes (1J and 1K) are now available to indicate conditional offers to spouses, such as when the employer only allows a spouse to enroll in the plan if the spouse does not have health insurance through their own employer.

 

Changes to Form 1094-B

  • The year was updated to “2016”

 

Changes to Form 1095-B

  • The year was updated to “2016”
  • “or other TIN” was added to Part I, lines 2 and 3 and Part IV, columns b and C
  • “Do not attach to your tax return. Keep for your records” was added to the title of the form
  • “Enter letter identifying Origin of Policy” was changed to “Enter letter identifying Origin of Health Coverage” in Part I, line 8
  • Line 9 is shaded and marked as “Reserved”

 

Draft instructions for Forms 1094-C and 1095-C are available here.

Draft instructions for Forms 1094-B and 1095-B are available here.

 


 

*Please Note:  All articles below pertain to 2015 ACA Reporting.  For articles regarding 2016 ACA reporting, please refer to the posts above.

 


 

Updated 6/10/16

ACA Reporting – IRS Filing Reminder

ACA reporting for the 2015 calendar year is coming to an end. Employers were required to furnish statements to their employees by 3/31/2016. The final step of the process is filing the requisite forms with the IRS. Employers who are e-filing the forms should ensure that they are on schedule to meet the 6/30/2016 e-filing deadline. Those who are enlisting the help of a vendor should confirm with the vendor that everything will be filed timely.

Please note that employers who are filing 250+ forms are required to e-file. Smaller employers that chose to paper file must have submitted their forms by the 5/31/2016 deadline.


 

Updated 3/10/2016

ACA Reporting Deadlines

The ACA reporting deadlines are fast approaching, with the deadline for furnishing ACA forms to individuals coming up at the end of the month.  As a reminder, the deadlines for the 2015 filings are as follows:

  • 3/31/2016 for providing individuals with Forms 1095-B and 1095-C
  • 5/31/2016 for paper filing with the IRS
  • 6/30/2016 for e-filing with the IRS

All employers subject to the reporting need to ensure that they are set up to meet the above deadlines.


 

Updated 2/9/2016

ACA Reporting Penalties

IRS Notice 2015-87 confirms that the IRS will not impose accuracy-related penalties on Forms 1094 and 1095 for the 2015 calendar year if the employer can demonstrate that it made good faith efforts to comply with the reporting requirements.  However, if an employer fails to timely file the reports with the IRS, penalties may apply unless the IRS determines that there was a reasonable cause for the late reporting.

The chart below summarizes the penalty structure for the 2015 filing (due in 2016) and the 2016 filing (due in 2017).

Conduct 2015 Penalty 2016 Penalty
Failure to file an information return or provide a payee statement $250 for each return with respect to which a failure occurs $260 for each return with respect to which a failure occurs
  • Annual penalty limit for non-willful failures
$3,000,000 $3,178,500
  • Lower limit for entities with gross receipts not exceeding $5M
$1,000,000 $1,059,500
Failures corrected within 30 days of required filing date $50 $50
  • Annual penalty limit when corrected within 30 days
$500,000 $529,500
  • Lower limit for entities with gross receipts not exceeding $5M when corrected within 30 days
$175,000 $185,000
Failures corrected by August 1 $100 $100
  • Annual penalty limit when corrected by August 1
$1,500,000 $1,589,000
  • Lower limit for entities with gross receipts not exceeding $5M when corrected by August 1
$500,000 $529,500
Failure to file an information return or provide a payee statement due to intentional disregard $500 for each return with respect to which a failure occurs (no cap) $520 for each return with respect to which a failure occurs (no cap)

Updated 1/5/2016

On 12/28 the Internal Revenue Service (IRS) issued Notice 2016-4, announcing that it will be extending the deadlines for the 2015 ACA reporting (Forms 1094-B, 1095-B, 1094-C, and 1095-C). The extension is intended to provide employers, insurers, and other providers of minimum essential coverage additional time to implement processes and gather the data necessary for this new reporting requirement.

The new deadlines are as follows:

  • 3/31/2016 for providing individuals with Forms 1095-B and 1095-C (previous deadline: 2/1/2016)
  • 5/31/2016 for paper filing with the IRS (previous deadline: 2/29/2016)
  • 6/30/2016 for e-filing with the IRS (previous deadline: 3/31/2016)

Due to this delay, it is possible that some individuals will not receive their forms in time for their 4/15/2016 individual tax filing deadline. However, the Department of Treasury and the IRS has stated that the vast majority of taxpayers will not be affected by this extension and can check a box on their tax return to indicate if they had coverage throughout 2015. Individuals who do not receive their forms on time should file their returns as they normally would and are not required to file an amended tax return. The forms simply provide individuals with a record of their health coverage, but do not need to be attached to their tax return.

Many employers are working with vendors who are assisting with the 2015 ACA reporting. Such employers should be on the lookout for updates from their vendors regarding any extended deadlines.

For additional information, please see IRS Notice 2016-4 and the IRS Q&A on what individuals should do with their Health Care Information Forms.


Updated 12/3/2015

The Internal Revenue Service has implemented a reporting procedure to ensure compliance with the Affordable Care Act’s Employer Mandate (“Play or Pay Mandate”) and Individual Mandate. Pursuant to IRC sections 6055 and 6056, in the first quarter of 2016, certain employers and insurance carriers will be required to report on offers of health coverage and enrollment, as well as minimum essential coverage (MEC). Employers and carriers will also be required to provide related statements to employees. This information will be reported on Forms 1094-B, 1095-B, 1094-C, and 1095-C.

The deadline for filing the returns with the IRS is 2/28 (or 3/31 if e-filing) of the year following the calendar year of coverage (i.e., 2016 for 2015). Please note that employers filing 250+ returns during the calendar year must file electronically. Employers are also required to provide a copy of Form 1095-B or 1095-C to the employee by 1/31 of the year following the calendar year of coverage. All deadlines that fall on a weekend will be moved to the following business day.

Action Item
Employers should ensure that they are either equipped to complete the ACA reporting internally or have partnered with a vendor who will assist with the reporting. Please see below for detailed information on what forms must be completed and the information to be reported.


Updated 9/28/2015

The final 2015 forms are now available:

Employers with self-insured group health plans:

Applicable Large Employers (ALEs) with 50+ full-time equivalent employees:

Please see the 9/21/2015 update below for the form instructions and a list of what has been changed.


Updated 9/21/2015

The IRS has released final versions of the 2015 instructions for Forms 1094-B, 1095-B, and Forms 1094-C and 1095-C, which include the changes noted below.

The IRS has changed their position on ACA reporting for HRAs.

Employer offers two plans that are minimum essential coverage (MEC) such as a self-funded major medical plan and a self-funded HRA: Such employers only need to report on one type of MEC for the individual.

Employer offers a fully-insured plan and also sponsors a self-funded HRA: Such employers do not need to report the HRA coverage if the individual is only eligible for the HRA because s/he is enrolled in the fully-insured group health plan.

Employee is covered by an HRA sponsored by the employer and a non-HRA group health plan sponsored by another employer (such as spousal coverage): Since the two types of coverage are not offered by the same employer, each employer must report the coverage that it provides.

COBRA continuation coverage reporting is not required for terminated employees.

The final instructions state that an offer of COBRA continuation coverage made to a former employee upon termination of employment should not be reported as an offer of coverage on line 14, regardless of whether the employee accepts or declines the coverage. For a terminated employee, code 1H (no offer of coverage) should be entered on line 14 for any month for which the offer of COBRA continuation coverage applies. Code 2A should be entered on line 16 to indicate that the employee was not employed on any day of the calendar month. The instructions remain the same in regard to COBRA continuation coverage reporting for active employees: it is reported in the same manner and using the same code as an offer of that type of coverage to any other active employee.


Updated 9/9/2015

In June 2015, the IRS released draft 2015 Forms 1094 and 1095. The IRS has now released draft instructions for these forms:

The 2015 draft instructions contain some changes from the 2014 instructions. Below is a summary of the major changes.

Increase in Penalties

The penalty for an employer who fails to file information returns has increased from $100 per return to $250 per return. The penalty cap has also increased from $1.5 million to $3 million.

Hand Delivery

Hand delivery is now an acceptable method of delivering the employee statement. Employers still have the option of sending the form by mail, or electronically if the employee affirmatively consents to electronic delivery.

COBRA Coverage

The draft instructions provide information on how to classify offers of COBRA continuation coverage. If COBRA is offered to a terminated employee, it is only reported as an offer of coverage if the terminated employee enrolls in COBRA. If the former employee does not enroll (even if his or her spouse or dependents enroll) in COBRA, the employer should use code 1H (no offer of coverage) in line 14 of Form 1095-C for any month in which the COBRA offer applies. If COBRA is offered to an employee who had a reduction in hours resulting in a loss of coverage, that coverage is reported in the same manner and with the same code as an offer of coverage to any other active employee. See update above from 9/21/2015 for the most recent and accurate information regarding reporting of COBRA coverage.

Multiemployer (Union) Plan Relief

Employers reporting on offers of coverage made under a multiemployer plan are directed to enter code 1H on line 14 of Form 1095-C for any month in which an employer enters code 2E on line 16 of Form 1095-C. Code 2E indicates that an employer is required to contribute to a multiemployer plan on behalf of the employee for that month and is eligible for multiemployer interim relief.

Extensions to File with the IRS

Employers who file Form 8809 by the due date of the returns will be granted an automatic 30-day extension to file their returns with the IRS. No explanation is required for the extension. Employers may also request an additional 30-day extension by submitting a second Form 8809 before the end of the first extension period. However, the additional extension is only granted if the employer can demonstrate that extenuating circumstances prevented the filing by the date granted by the first request.

Extensions to Furnish Employee Statements

Employers may request an extension of time to furnish the employee statements by mailing a letter to the IRS, postmarked by the date on which the statements are due to the recipients. The letter must include identifying information of the recipient and the reason for the delay. If the request is granted, the maximum extension will be 30 days.

Waiver of Electronic Filing Requirement

Per the regulations, employers who are filing 250+ information returns are required to file electronically. However, the 2015 draft instructions state that employers can submit Form 8508 to request a waiver from filing information returns electronically. The waiver must be filed at least 45 days before the due date of the information returns.

Reporting for Employers with HRAs

The draft instructions state that the B-series forms applies to all employers that sponsor a self-insured health reimbursement arrangement (HRA) for their employees, even if the HRA is paired with a fully-insured group health plan. Therefore, an ALE with a fully-insured group health plan and an HRA would need to also complete Part III of Form 1095-C for months in which an employee had coverage under the HRA. A small employer with a fully-insured group health plan and an HRA would need to complete Form 1095-B for months in which an employee had coverage under the HRA. See update above from 9/21/2015 for the most recent and accurate information regarding reporting of HRA coverage.

It is anticipated that the final versions of the forms and instructions will be released in the fall of 2015.


Updated 6/29/2015

The IRS has released draft 2015 Forms 1094 and 1095. Please note, however, that these are DRAFT forms; final versions will be released later. For the most part, the 2015 forms remain unchanged from the 2014 versions. Below is a list of changes, if any, to the 2014 version of the forms.

1094-B

  • No changes

1095-B

  • The last page, “Instructions for Recipient,” has been omitted; however, it is possible that this may be re-added to the final version of the 2015 form.

1094-C

  • Part I now includes line 19 (regarding the authoritative transmittal). In the 2014 version, line 19 was included as the first line of Part II;
  • Part III, Column (b) (Full-Time Employee Count for ALE Member) now allows information to be entered in the “All 12 months” box. This box was grayed in the 2014 version;
  • Part IV (Covered Individuals) has an additional continuation sheet for reporting coverage for more than six individuals; and
  • The last page, “Instructions for Recipient,” has been omitted; however, it is possible that this may be re-added to the final version of the 2015 form.

1095-C

  • Part II (Employee Offer of Coverage) now asks for “Plan Start Month.” This new field is optional for 2015. For 2015 and beyond, this field will be required. ALEs have the option to do one of the following: 1) include this field and provide plan year information; 2) include this field and enter “00”; or 3) not include this new field (i.e., use the 2014 format);
  • Part II, line 14 (Offer of Coverage) may include two additional codes for 2016 and beyond to indicate that the employer’s offer to the spouse is a conditional offer;
  • Part III (Covered Individuals) has an additional continuation sheet for reporting coverage for more than six individuals; and
  • The last page, “Instructions for Recipient,” has been omitted; however, it is possible that this may be re-added to the final version of the 2015 form.

What information needs to be reported?  You will need to provide the IRS with details on the classification of your company, types of coverage offered, individuals covered, and other pieces of information as requested on the applicable forms.

Who will be affected by this new reporting requirement?  1) Employers with self-insured group plans; and 2) Applicable Large Employers (ALEs) with 50+ full-time equivalent employees

What do I need to do?

  • Now: Review your systems to ensure that the information needed is being captured.
  • By 1/31/2016: You must provide your employees with statements containing this information
  • By 2/28/2016: You must file the applicable forms with the IRS (or 3/31/2016 if filing electronically)

More Information

2015 will be the first year in which some employers will have to track information about offers of affordable coverage so that they can accurately report this information to the IRS, as well as provide related statements to employees in the first quarter of 2016.

Employers affected by this new mandate include:

Those with self-insured group plans (IRC Section 6055)

  • Must file Forms 1094-B and 1095-B (links include forms and instructions).  Please note that these forms are for 2014 reporting only, which is optional.  Reporting for 2015 will be mandatory, and updated forms will be provided later this year.
  • Note: if the employer is also an Applicable Large Employer, then they must file Forms 1094-C and 1095-C in lieu of Forms 1094-B and 1095-B, and this will satisfy both the Section 6055 and Section 6056 reporting requirements.

Applicable Large Employers (ALEs) with 50+ full-time equivalent employees (IRC Section 6056)

  • Must file Forms 1094-C and 1095-C (links include forms and instructions).  Please note that these forms are for 2014 reporting only, which is optional.  Reporting for 2015 will be mandatory, and updated forms will be provided later this year.
  • In determining whether an employer is an ALE, employees of parent, subsidiary, or other affiliated companies must be combined in the calculation. If the combined employee count is 50+, then each of the companies is considered an ALE and is subject to the Section 6056 reporting requirement.
  • Please note: employers that qualify for transition relief from the Play or Pay Mandate described above are still subject to the IRC Section 6056 reporting requirement.

Information to be reported:

Those with self-insured group plans

  • The employer’s name, address, and employer identification number (EIN)
  • The name and social security number (or date of birth if social security number is not available) of each individual (employee and applicable dependents) covered under the policy or program and the months for which the individual was enrolled in coverage and entitled to receive benefits

Applicable Large Employers (ALEs)

  • The employer’s name, address, and employer identification number (EIN)
  • A certification as to whether the employer offers to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan
  • If the employer certifies that all full-time employees (and their dependents) were offered the opportunity to enroll, the following information must also be furnished: 1) the length of any waiting period; 2) the months during the calendar year for which coverage under the plan was available; 3) the monthly premium for the lowest cost option in each of the enrollment categories under the plan; 4) the employer share of the total allowed costs of benefits provided under the plan
  • The number of full-time employees  for each month during the calendar year
  • The name, address, and social security of each full-time employee during the calendar year and the months (if any) during which such employee (and any dependents) were covered under any such health plan

Deadlines:
The deadline for filing the returns with the IRS is 2/28 (or 3/31 if e-filing) of the year following the calendar year of coverage (i.e., 2016). Please note: employers filing 250 or more returns during the calendar year must file electronically.

Employers are also required to provide a copy of Form 1095-B or 1095-C to the employee by 1/31 of the year following the calendar year of coverage. All deadlines that fall on a weekend will be moved to the following business day.

Employers should ensure that they currently have a system in place to capture the data that they will need for the Section 6055 and Section 6056 reporting. For more detailed information, including a webinar on these reporting requirements, please contact your Sequoia Client Service Manager.

Resources:
Final versions of the forms listed above have not yet been released, but the IRS has provided a very comprehensive Q&A for Section 6055 and Section 6056 reporting. Additionally, Benefits Advisors Network has provided a webinar on the reporting requirement, which you may access here by logging in with your Sequoia-sponsored credentials.

 

The information and materials on this blog are provided for informational purposes only and are not intended to constitute legal or tax advice. Information provided in this blog may not reflect the most current legal developments and may vary by jurisdiction. The content on this blog is for general informational purposes only and does not apply to any particular facts or circumstances. The use of this blog does not in any way establish an attorney-client relationship, nor should any such relationship be implied, and the contents do not constitute legal or tax advice. If you require legal or tax advice, please consult with a licensed attorney or tax professional in your jurisdiction. The contributing authors expressly disclaim all liability to any persons or entities with respect to any action or inaction based on the contents of this blog.

Bonnie Mangels – Bonnie is the Corporate Counsel and Senior Compliance Manager for Sequoia. When not inundated in paperwork and legal briefs, her interests include arts and crafts, bunnies, and the Bay Area.