Recently, New Jersey posted updated guidance on 2020 reporting and distribution obligations under the New Jersey Individual Mandate (NJ Mandate). The 2020 guidance is summarized below.
Compliance Snapshot:
All employers (including out-of-state employers) who provided healthcare coverage to employees who were NJ residents in 2020 must do the following:
- Form Distribution: Ensure covered employees who were NJ residents in 2020 receive at least one 1095 form by March 2, 2021.
- Fully insured employers: Carriers should distribute 1095-B forms to plan participants pursuant to their Affordable Care Act (ACA) obligation. No additional employer distribution is required.
- Self-insured/Level funded employers: Employers satisfy the state distribution requirement when distributing 1095 forms to plan participants pursuant to their ACA obligation. No additional distribution is required.
- State Reporting: Ensure an IRS 1095 form or NJ 1095 form (the state-specific form) for each covered NJ resident is submitted to the state by March 31, 2021.
- Fully insured employers: Only required to report if their carrier fails to report (carriers have a reporting obligation for fully insured plans).
- Self-insured/Level funded employers: Must submit 1095 forms for each covered employee who was a part-year or full-year NJ resident in 2020.
Form Distribution
What is the distribution requirement?
Employers must ensure at least one 1095 form is sent to each primary enrollee (i.e. employee) who was a part-year or full-year NJ resident.
Who must forms be distributed to?
Employers must provide a 1095 form to each primary enrollee who was a part-year or full-year NJ resident. Part-year NJ residents are those domiciled in NJ for at least 15 days in any month. Employers are not required to send separate 1095 forms to spouses, dependent children, or adult children of primary enrollees.
Is the NJ distribution requirement satisfied if 1095 forms are distributed for ACA reporting purposes?
Yes. Carriers of fully insured plans are required to distribute 1095-B forms to covered plan participants under the ACA, so fully insured employers should have no further distribution requirement. Self-insured and level funded employers should distribute 1095-B/C forms pursuant to their ACA obligation. If this is completed, self-insured and level-funded employers have no further distribution obligation.
How does the NJ distribution requirement differ from the ACA distribution requirement?
For 2020 ACA reporting, small self-insured employers are permitted to distribute 1095-B forms through an online posting in lieu of a paper distribution. This online posting will not satisfy the NJ Mandate distribution requirements. NJ requires that 1095 forms be sent to each primary enrollee.
What is the deadline to distribute forms?
The deadline to distribute forms is March 2, 2021, which is the same as the 2020 federal ACA distribution deadline.
State Reporting
Are fully insured employers required to report if their carrier does?
No, employers are not required to report if their carrier does. Carriers of fully insured plans are required to file 1095 forms for each covered NJ resident to the state. If carriers do not meet their obligation, employers are required to report.
How do employers complete the NJ Mandate reporting?
Employers must submit a 1095 form for each covered employee who was a NJ resident. Employers can either submit copies of IRS 1095 forms (fully completed 1095-B forms, fully completed 1095-C forms, or 1095-C forms with parts I and III completed) prepared for their NJ employees for ACA reporting purposes or a NJ-1095, the state-specific equivalent of the federal 1095 forms. The 2020 NJ-1095 form is not yet available (as of the time this article was written), but the DOT expects it to be similar to the 2019 version.
NJ does not require employers to submit federal 1094 forms but will accept them if they are submitted as a part of a larger file that includes 1095 forms.
For ease of filing, employers can submit a copy of their ACA reporting to the state, even if it includes 1095 forms on individuals who are not NJ residents and it will be accepted. If employers want to take this approach, they should consult with counsel to determine whether providing information on non-residents would violate any applicable privacy laws before sending any non-resident information.
How does NJ reporting requirements differ from federal ACA reporting requirements?
Carrier and employer requirements under the ACA and the NJ Mandate are compared below:
Fully Insured (Non-ALE) Plan Type
| Federal ACA Requirements | NJ Mandate Requirements | Differences |
| Carrier: Distribute 1095-B forms to plan participants | Carrier: File 1095-B or NJ-1095 forms for each covered NJ resident to the state | Employer is required to submit 1095 forms to the state if their carrier does not |
| Employer: Not required to report or distribute forms to the IRS | Employer: If the carrier does not report, employers are required to report | Same as above |
Fully Insured (ALE) Plan Type
| Federal ACA Requirements | NJ Mandate Requirements | Differences |
| Carrier: Distribute 1095-B forms to plan participants | Carrier: File 1095-B or NJ-1095 forms for each covered NJ resident to the state | Employer is required to submit 1095 forms to the state if their carrier does not |
| Employer: 1. File Forms 1094/5-C (Part III will not be completed) 2. Distribute Forms 1095-C to full time plan participants | Employer: If the carrier does not report, employers are required to report | Same as above |
Self-Insured (Non-ALE) Plan Type
| Federal ACA Requirements | NJ Mandate Requirements | Differences |
| Carrier: None | Carrier: None | 1. Employers must file 1095-B or NJ-1095 forms for employees who are NJ residents to the state 2. Employees do not satisfy the NJ distribution requirement by posting a notice on the availability of 1095-B forms (as allowed under the IRS rules) |
| Employer: 1. File Forms 1094/5-B 2. Distribute Forms 1095-B to plan participants (alternatively, employers can post an online notice) | Employer: 1. File 1095-B or NJ-1095 forms for each covered employee who was a NJ resident 2. Distribute Forms 1095-B to NJ plan participants (NJ does not allow employers to post an online notice) | Same as above |
Self-Insured (ALE) Plan Type
| Federal ACA Requirements | NJ Mandate Requirements | Differences |
| Carrier: None | Carrier: None | 1. Employers must file 1095-B or NJ-1095 forms for employees who are NJ residents to the state 2. Employees do not satisfy the NJ distribution requirement by posting a notice on the availability of 1095-B forms (as allowed under the IRS rules) |
| Employer: 1. File Forms 1094/5-C (with Parts I, II, and III completed) 2. Distribute Forms 1095-C to full time plan participants (for non-full-time plan participants, employers can post an online notice) | Employer: 1. File fully completed 1095-C, 1095-B, or NJ-1095 for each covered employee who was a NJ resident 2. Distribute 1095 forms to NJ plan participants (NJ does not allow employers to post an online notice) | Same as above |
How can employers submit NJ Mandate reporting?
Employers must submit reporting online, no paper filing is available. Employers can submit reporting using two methods:
- Employers submitting 100 or more forms: must use the Division of Revenue and Enterprise Services’ (DORES) MFT SecureTransport (Axway) service.
- Employers who do not have a MFT service account or who need technical specifications and guidance should contact DORES. Once DORES receives account and authorizes the account, they will send instructions on how to submit the forms.
- Employers submitting less than 100 forms: can use NJ-1095 to submit one form at a time. NJ will post a link to the 2020 NJ-1095 form before the reporting deadline.
When is the deadline to submit NJ Mandate reporting?
The deadline to submit reporting is March 31, 2021, which is the same deadline to submit electronic ACA reporting to the IRS.
Employer Action Items
- Fully Insured Employers: Confirm with your carrier that they will submit NJ Mandate reporting for your employees who were NJ residents in 2020.
- Self-Insured Employers: Reach out to your ACA reporting vendor to determine whether they will assist with NJ Mandate reporting or prepare to file the reporting online. Employers who do not currently have an MFT account must contact DORES to set one up.
Additional Resources
Disclaimer: This content is intended for informational purposes only and should not be construed as legal, medical or tax advice. It provides general information and is not intended to encompass all compliance and legal obligations that may be applicable. This information and any questions as to your specific circumstances should be reviewed with your respective legal counsel and/or tax advisor as we do not provide legal or tax advice. Please note that this information may be subject to change based on legislative changes. © 2020 Sequoia Benefits & Insurance Services, LLC. All Rights Reserved
