Background Information:

Applicable large employers (ALEs) under the Affordable Care Act are required to file certain information with the IRS regarding the offer of health insurance coverage for their full-time employees.

The IRS has begun issuing notices to ALEs who have not filed the proper Forms 1095-C, Employer-Provided Health Insurance Offer and Coverage, and 1094-C, Transmittal of Employer Provided Health Insurance Offer and Coverage, for prior years 2015 and 2016.  The IRS notices are entitled Request for Employer Reporting of Offers of Health Insurance Coverage (also known as Letter 5699).   A response to the IRS request is required within 30 days of the date of the letter.

The IRS letter offers the following employer responses:

  • The employer has already complied with reporting duties;
  • The employer did not comply but is now sending in the required forms with the return letter;
  • The employer would like ninety days (or later, if explained in the form) to file the proper forms;
  • The employer was not an “Applicable Large Employer” for the year in question; or
  • If none of the above, the employer can make a statement about why the returns were not filed and the planned course of action.


Action Items:

Should an employer receive IRS Letter 5699, they should consult with their benefits administrator and/or pertinent legal counsel and respond to the IRS request within the 30-day deadline.  The IRS Code provides for penalty taxes under IRC Section 6721 for failure to file the above-mentioned forms.


Additional Resources:

Sample Letter 5699

Applicable Large Employer Determination

IRS Q&A 1094-C and 1095-C

IRS Penalty Information


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