Last week, the IRS issued it updated Form 1094-C and 1095-C instructions for 2019. Employers that employ New Jersey residents, however, may have more reading to do. New Jersey responded to the federal repeal of the Affordable Care Act’s (ACA) individual mandate, by enacting a mandate of its own. The New Jersey Health Insurance Market Preservation Act (Act), which became effective on January 1, 2019, imposes a penalty on New Jersey taxpayers who do not have minimum essential coverage during each month of the year. But, the Act also imposes some obligations for employers.

Requirements for individuals

Beginning January 1, 2019, Garden State residents who fail to maintain coverage will be subject to a Shared Responsibility Payment (SRP) due with their 2019 New Jersey Income Tax return. The amount of the SRP is generally based on income and family size and is capped at the statewide average annual premium for Bronze Health Plans in New Jersey. For individual taxpayers, the penalty could be as little as $695 or as much as $3012, and it goes up from there for families. Find out more here.

Requirements for employers

In order to administer the penalty, New Jersey needs third parties to verify health coverage information supplied by individual taxpayers. Accordingly, the state is looking to employers (including out-of-state employers) and all other providers of minimum essential coverage to New Jersey residents to send health-care coverage returns to the state for the 2019 tax year. In short, this means that for 2019, employers that employed New Jersey residents may have to make a filing with the state. Employers will transmit these returns through New Jersey’s system for processing W-2 forms.

One question some employers have is whether they have a reporting requirement to New Jersey, even if they do not have Form 1094/1094 reporting requirements under the ACA to the IRS – such as if the employer is not an “applicable large employer” under the ACA and offers only fully-insured coverage. The Act generally provides that every employer sponsoring an employment-based health plan that provides minimum essential coverage to a New Jersey resident must file a return with the state concerning that resident’s coverage. In the absence of additional guidance from the state, employers with New Jersey residents should seek appropriate counsel concerning their reporting obligations.

If reporting is required, the state will permit employers to send the same Forms 1094/1095 that they transmit to the IRS to satisfy the Act’s requirements. However, the state encourages companies to send data pertaining only to New Jersey full-year and part-year residents as providing information on non-residents of New Jersey may raise privacy and other issues. Coverage returns must be filed with New Jersey no later than March 31, 2020.

Employers with New Jersey employees also may want to encourage their employees who receive Form 1094/1095 from them to provide those forms to the employees’ dependents for completion of their own NJ state tax returns, if applicable.

For more information about these requirements in New Jersey, check out the information site set up by the state.


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Photo of Joseph J. Lazzarotti Joseph J. Lazzarotti

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP)…

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP) with the International Association of Privacy Professionals. Trained as an employee benefits lawyer, focused on compliance, Joe also is a member of the firm’s Employee Benefits practice group.

In short, his practice focuses on the matrix of laws governing the privacy, security, and management of data, as well as the impact and regulation of social media. He also counsels companies on compliance, fiduciary, taxation, and administrative matters with respect to employee benefit plans.

Privacy and cybersecurity experience – Joe counsels multinational, national and regional companies in all industries on the broad array of laws, regulations, best practices, and preventive safeguards. The following are examples of areas of focus in his practice:

  • Advising health care providers, business associates, and group health plan sponsors concerning HIPAA/HITECH compliance, including risk assessments, policies and procedures, incident response plan development, vendor assessment and management programs, and training.
  • Coached hundreds of companies through the investigation, remediation, notification, and overall response to data breaches of all kinds – PHI, PII, payment card, etc.
  • Helping organizations address questions about the application, implementation, and overall compliance with European Union’s General Data Protection Regulation (GDPR) and, in particular, its implications in the U.S., together with preparing for the California Consumer Privacy Act.
  • Working with organizations to develop and implement video, audio, and data-driven monitoring and surveillance programs. For instance, in the transportation and related industries, Joe has worked with numerous clients on fleet management programs involving the use of telematics, dash-cams, event data recorders (EDR), and related technologies. He also has advised many clients in the use of biometrics including with regard to consent, data security, and retention issues under BIPA and other laws.
  • Assisting clients with growing state data security mandates to safeguard personal information, including steering clients through detailed risk assessments and converting those assessments into practical “best practice” risk management solutions, including written information security programs (WISPs). Related work includes compliance advice concerning FTC Act, Regulation S-P, GLBA, and New York Reg. 500.
  • Advising clients about best practices for electronic communications, including in social media, as well as when communicating under a “bring your own device” (BYOD) or “company owned personally enabled device” (COPE) environment.
  • Conducting various levels of privacy and data security training for executives and employees
  • Supports organizations through mergers, acquisitions, and reorganizations with regard to the handling of employee and customer data, and the safeguarding of that data during the transaction.
  • Representing organizations in matters involving inquiries into privacy and data security compliance before federal and state agencies including the HHS Office of Civil Rights, Federal Trade Commission, and various state Attorneys General.

Benefits counseling experience – Joe’s work in the benefits counseling area covers many areas of employee benefits law. Below are some examples of that work:

  • As part of the Firm’s Health Care Reform Team, he advises employers and plan sponsors regarding the establishment, administration and operation of fully insured and self-funded health and welfare plans to comply with ERISA, IRC, ACA/PPACA, HIPAA, COBRA, ADA, GINA, and other related laws.
  • Guiding clients through the selection of plan service providers, along with negotiating service agreements with vendors to address plan compliance and operations, while leveraging data security experience to ensure plan data is safeguarded.
  • Counsels plan sponsors on day-to-day compliance and administrative issues affecting plans.
  • Assists in the design and drafting of benefit plan documents, including severance and fringe benefit plans.
  • Advises plan sponsors concerning employee benefit plan operation, administration and correcting errors in operation.

Joe speaks and writes regularly on current employee benefits and data privacy and cybersecurity topics and his work has been published in leading business and legal journals and media outlets, such as The Washington Post, Inside Counsel, Bloomberg, The National Law Journal, Financial Times, Business Insurance, HR Magazine and NPR, as well as the ABA Journal, The American Lawyer, Law360, Bender’s Labor and Employment Bulletin, the Australian Privacy Law Bulletin and the Privacy, and Data Security Law Journal.

Joe served as a judicial law clerk for the Honorable Laura Denvir Stith on the Missouri Court of Appeals.