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In IRS Notice 2018-94, the IRS announced an extension for furnishing 2018 IRS Forms 1095-B (Health Coverage) and 1095-C (Employer-Provided Health Insurance Offer and Coverage), from January 31, 2019, to March 4, 2019.  The IRS issued this extension in response to requests by employers, insurers, and other providers of health insurance coverage that additional time be provided to gather and analyze the information required to complete the Forms and is largely identical to the extension the IRS provided for furnishing the 2016 and 2017 Forms.  Despite the extension, the IRS encourages employers and other coverage providers to furnish the Forms as soon as possible.

Consistent with the prior Notices, Notice 2018-94 does not extend the due date for employers, insurers, and other providers of minimum essential coverage to file 2018 Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS.  The filing due date for these forms remains February 28, 2019 (April 1, 2019, if filing electronically), unless the due dates are extended under other available relief.

The IRS also reveals in Notice 2018-94 that, while failure to furnish and file the Forms on a timely basis may subject employers and other coverage providers to penalties, such entities should still attempt to furnish and file even after the applicable due date as the IRS will consider such action when determining whether to abate penalties.

Notice 2018-94 also provides that good faith reporting standards will apply once again for 2018 reporting.  This means that reporting entities will not be subject to reporting penalties for incorrect or incomplete information if they can show that they have made good faith efforts to comply with the 2018 Form 1094 and 1095 information-reporting requirements.  This relief applies to missing and incorrect taxpayer identification numbers and dates of birth, and other required return information.  However, no relief is provided where there has not been a good faith effort to comply with the reporting requirements or where there has been a failure to file an information return or furnish a statement by the applicable due date (as extended).

Finally, an individual taxpayer who files his or her tax return before receiving a 2018 Form 1095-B or 1095-C, as applicable, may rely on other information received from his or her employer or coverage provider to file his or her return.  If employers take advantage of the extension in Notice 2018-94 and receive employee requests for 2018 Forms 1095-C before the extended due date, they should refer their employees to the guidance in Notice 2018-94.

Notably, Notice 2018-94 states that “[b]ecause the individual shared responsibility payment is reduced to zero for months beginning after December 31, 2018, Treasury and the Service are studying whether and how the reporting requirements [regarding reporting by insurers, self-insured employers and other providers of minimum essential coverage] should change, if at all, for future years.”  We anticipate changes in the reporting requirements for 2019.  Stay tuned for further developments.

In IRS Notice 2018-06, the IRS announced a 30-day automatic extension for the furnishing of 2017 IRS Forms 1095-B (Health Coverage) and 1095-C (Employer-Provided Health Insurance Offer and Coverage), from January 31, 2018 to March 2, 2018.  This extension was made in response to requests by employers, insurers, and other providers of health insurance coverage that additional time be provided to gather and analyze the information required to complete the Forms and is virtually identical to the extension the IRS provided for furnishing the 2016 Forms 1094-C and 1095-C in Notice 2016-70.  Notwithstanding the extension, the IRS encourages employers and other coverage providers to furnish the Forms as soon as possible.

Notice 2018-06 does not extend the due date for employers, insurers, and other providers of minimum essential coverage to file 2017 Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS.  The filing due date for these forms remains February 28, 2018 (April 2, 2018, if filing electronically), unless the due dates are extended pursuant to other available relief.

The IRS also indicates in Notice 2018-06 that, while failure to furnish and file the Forms on a timely basis may subject employers and other coverage providers to penalties, such entities should still attempt to furnish and file even after the applicable due date as the IRS will take such action into consideration when determining whether to abate penalties.

Additionally, Notice 2018-06 provides that good faith reporting standards will apply once again for 2017 reporting. This means that reporting entities will not be subject to reporting penalties for incorrect or incomplete information if they can show that they have made good faith efforts to comply with the 2017 Form 1094 and 1095 information-reporting requirements. This relief applies to missing and incorrect taxpayer identification numbers and dates of birth, and other required return information. However, no relief is provided where there has not been a good faith effort to comply with the reporting requirements or where there has been a failure to file an information return or furnish a statement by the applicable due date (as extended).

Finally, an individual taxpayer who files his or her tax return before receiving a 2017 Form 1095-B or 1095-C, as applicable, may rely on other information received from his or her employer or coverage provider for purposes of filing his or her return. Thus, if employers take advantage of the extension in Notice 2018-06 and receive employee requests for 2017 Forms 1095-C before the extended due date, they should refer their employees to the guidance in Notice 2018-06.

 

In IRS Notice 2016-70, the IRS announced a 30-day automatic extension for the furnishing of 2016 IRS Forms 1095-B (Health Coverage) and 1095-C (Employer-Provided Health Insurance Offer and Coverage), from January 31, 2017 to March 2, 2017.  This extension was made in response to requests by employers, insurers, and other providers of health insurance coverage that additional time be provided to gather and analyze the information required to complete the Forms.  Notwithstanding the extension, the IRS encourages employers and other coverage providers to furnish the Forms as soon as possible.

Notice 2016-70 does not extend the due date for employers, insurers, and other providers of minimum essential coverage to file 2016 Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS.  The filing due date for these forms remains February 28, 2017 (March 31, 2017, if filing electronically), unless the due dates are extended pursuant to other available relief.

The IRS also indicates in Notice 2016-70 that, while failure to furnish and file the Forms on a timely basis may subject employers and other coverage providers to penalties, such entities should still attempt to furnish and file even after the applicable due date as the IRS will take such action into consideration when determining whether to abate penalties.

Additionally, Notice 2016-70 provides that good faith reporting standards will apply for 2016 reporting. This means that reporting entities will not be subject to reporting penalties for incorrect or incomplete information if they can show that they have made good faith efforts to comply with the 2016 Form 1094 and 1095 information-reporting requirements. This relief applies to missing and incorrect taxpayer identification numbers and dates of birth, and other required return information. However, no relief is provided where there has not been a good faith effort to comply with the reporting requirements or where there has been a failure to file an information return or furnish a statement by the applicable due date (as extended).

Finally, an individual taxpayer who files his or her tax return before receiving a 2016 Form 1095-B or 1095-C, as applicable, may rely on other information received from his or her employer or coverage provider for purposes of filing his or her return. Thus, if employers take advantage of the extension in Notice 2016-70 and receive employee requests for 2016 Forms 1095-C before the extended due date, they should refer their employees to the guidance in Notice 2016-70.

Takeaways

  • Employers may post a notice on their website instead of automatically furnishing Forms 1095-B and 1095-C to all full-time employees.  The first due date for such a notice is March 3 for 2024 forms, and the notice must remain accessible until October 15.

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The Employer Reporting Improvement Act and the Paperwork Burden Reduction Act (the Acts) introduced significant changes to the reporting and enforcement rules of the Affordable Care Act (ACA).  We discussed the Acts in an earlier blog.  Recently, the IRS issued Notice 2025-15, which provides the promised guidance for reporting entities on how to furnish Forms 1095-B and 1095-C.  Here is what plan sponsors need to know:

Alternative Method for Furnishing Forms

  • Rather than automatically sending out Forms 1095-B and 1095-C, sponsors may post a notice on their website indicating that such forms are available upon request.
  • Sponsors must ensure the notice is clear, conspicuous, and accessible to anyone entitled to such a form.
  • Forms must be provided within 30 days of any request or by January 31, whichever is earlier.
  • In order to ensure compliance with the new IRS guidance, we recommend posting the notice to the sponsor’s website, even if the notice is also provided via email or otherwise.

Additional Compliance Requirements

  • Notices must be posted by the due date for delivering the forms, including the automatic 30-day extension.
    • For example, for 2024 forms, sponsors must post the notice by March 3, 2025.
  • Entities must also adhere to any state requirements for furnishing the forms, and some states do require that the forms (or their state equivalent) be sent to all individuals.
    • Note that forms still must be filed with the IRS, even if they are not provided to all employees.

Effective Date

  • The guidance is effective starting with the 2024 calendar year forms.

Following these steps can help ensure compliance with IRS requirements for ACA forms.  The Jackson Lewis Employee Benefits Practice Group members can assist if you have questions or need assistance. Please contact a Jackson Lewis employee benefits team member or the Jackson Lewis attorney with whom you regularly work.  Subscribe to the Benefits Law Advisor Blog here.

In a win for plan sponsors, the recently enacted Employer Reporting Improvement Act and the Paperwork Burden Reduction Act (the Acts), among other things, introduce several significant changes to the reporting and enforcement rules of the Affordable Care Act (ACA). 

The Current Rules

Forms 1095-B and 1095-C:  Under the ACA, plan sponsors, specifically Applicable Large Employers (ALEs), must report information about the health coverage they offer to their employees.  This ACA reporting is done through Forms 1095-B and 1095-C, which must be filed with the IRS and provided to all full-time employees and employees receiving employer-sponsored coverage. (This is the case, even though the ACA’s individual mandate is currently set to $0, and therefore functionally isn’t being enforced.)

Key aspects of ACA enforcement also include:

  • A Tight Turnaround to Respond to Proposed Assessments: The IRS may assess employer shared responsibility payments (ESRP) based on a plan sponsor’s reporting.  Before making this assessment, the IRS will send a letter with a proposed ESRP, to which sponsors can respond with corrected coding and other mitigating information.  Plan sponsors currently have only 30 days to respond to these letters.  This can be particularly challenging, as the letters are sent via US mail and often take time to get to the right person.  A late response can result in an ESRP assessment when one isn’t warranted, and additional penalties.
  • No Statute of Limitations: The period for assessing and collecting ESRPs has generally been open-ended, with no statute of limitations to potentially limit liability for aged amounts.

Changes Introduced by the Acts

The Acts introduce several changes which will improve the reporting and enforcement process for sponsors:

  • Forms 1095-B and 1095-C:  Plan sponsors (and health insurance providers for fully insured plans) are no longer required to send these Forms to all full-time employees and covered individuals. Instead, these Forms must only be sent in response to an employee/covered individual’s request.  If requested, the applicable Form must be provided by the later of January 31 or 30 days after the date of the request. One big caveat – in order to take advantage of this change, sponsors must provide notice to employees, telling them about their right to ask for a Form.  Further guidance on the form and requirements for this notice is likely forthcoming. Meanwhile, a good faith interpretation may suffice when drafting the notices.
  • Extended Response Time for Proposed ESRPs: Plan sponsors will now have at least 90 days to respond to a proposed ESRP before further action is taken. This extension provides plan sponsors more time to open their mail! (With more time to gather necessary information and respond appropriately, which may result in fewer ESRP assessments and other penalties.)
  • Statute of Limitations on Penalty Assessment: There will now be a six-year period for collecting ESRPs, counting from the due date for filing the applicable Forms 1095-B and 1095-C or the actual filing date, whichever is later. This extension provides clarity and predictability for plan sponsors, capping potential assessments and allowing sponsors to better manage their compliance efforts.

The Jackson Lewis Employee Benefits Practice Group members can assist if you have questions or need assistance with these latest changes. Please contact a Jackson Lewis employee benefits team member or the Jackson Lewis attorney with whom you regularly work.

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Just three weeks ago, we wrote that employers likely would not receive certain Affordable Care Act reporting relief to which they’ve become accustomed.

But in a welcome turn of events, the IRS just released proposed regulations that make permanent a 30-day automatic extension for furnishing Forms 1095-B and 1095-C to individuals.  Such forms will now be due each year on March 2nd (or the next business day if March 2nd falls on a weekend/holiday), and the relief is immediate—furnishers can rely on the proposed regulations for 2021 reporting (due in 2022).

The proposed regulations do not change the February 28th/March 31st due dates for submitting these forms to the IRS when filing by paper or electronically, respectively.

The proposed regulations also offer an alternative manner of satisfying the requirements for health insurance issuers and governmental agencies to furnish Forms 1095-B to health plan participants and for self-insured employers to furnish Forms 1095-C with certain health care coverage information to part-time employees and non-employees (such as former employees).  Under the new rules, these forms need not be automatically provided, as long as the furnisher prominently posts a notice on its website indicating the availability of the forms (with certain required language and contact information) and provides any such form within 30 days of an individual’s request.  This rule is being put in place to simplify administration, given that the individual shared responsibility payment (i.e., the individual mandate) is currently $0 and, therefore, the forms aren’t required for individuals to complete their tax returns.  It is subject to change if the individual mandate is increased in the future.

Self-insured employers furnishing Forms 1095-C to full-time employees may not use this alternative means and must provide Forms 1095-C to all such employees by the new deadline set forth above.

One caveat is that it isn’t yet clear whether these new (or analogous) rules will apply for states with their own individual mandate and reporting requirements (currently, California, Massachusetts, New Jersey, Rhode Island, Vermont, and the District of Columbia).

And, in perhaps their only downside, the proposed regulations confirm the end of the transitional good-faith relief for incorrect or incomplete ACA reporting. However, the general penalty exception remains for filers with reasonable cause for failing to timely or accurately complete their reporting requirements.

Please contact a team member or the Jackson Lewis attorney with whom you regularly work if you have questions or need assistance.

As employers with 50 or more full-time (or full-time equivalent) employees are well aware, the Patient Protection and Affordable Care Act (”ACA”) requires annual submission of Forms 1094-C and 1095-C with the Internal Revenue Service, and distribution of Forms 1095-C.  These submissions and distributions are generally due:

 Furnishing of Forms 1095-C to employees: January 31

Paper submission of Forms 1094-C and 1095-C to the IRS (if applicable):

 February 28

Electronic submission of Forms 1094-C and 1095-C to the IRS (required for employers submitting 250+ forms):

 March 31

Over the years since these requirements became effective, however, the IRS has often extended these deadlines.  First, such extensions were intended to aid employers as they got used to the new rules. Most recently, an extension was announced via Notice 2020-76 regarding the 2020 deadlines to recognize the challenges brought by the COVID-19 pandemic.

No such luck, it appears, for the 2021 reporting as no such extension has been announced (nor is one expected).  This means that employers subject to the ACA’s reporting requirements should be working internally or with their outside vendors to meet these deadlines.

One issue we are seeing is that employers who have fluctuated in size a great deal over the past two years (sometimes getting smaller and then growing again quickly, or vice versa) are unsure of whether the ACA reporting requirements apply to them.  Generally, the reporting requirements apply starting the year after which the employer first averages 50 or more full-time (including full-time equivalent) employees on business days.  As with all things tax code, however, there can be a lot more to the analysis.

The Employee Benefits practice group is available to help employers navigate these rules’ nuances and ensure they don’t get tripped up with unexpected reporting penalties.  Please contact a team member or the Jackson Lewis attorney with whom you regularly work if you have questions or need assistance.

In Notice 2016-4, the IRS has extended the due dates for certain 2015 Affordable Care Act information reporting requirements.

Specifically, the Notice extends:

  • the due date for furnishing to individuals the 2015 Form 1095-B and Form 1095-C from February 1, 2016, to March 31, 2016, and
  • the due date for filing with the IRS the 2015 Form 1094-B, Form 1094-C and Form 1095-C from February 29, 2016, to May 31, 2016, if not filing electronically, and from March 31, 2016, to June 30, 2016 if filing electronically.

For detailed information about these Forms, please see our earlier article.

In the Notice, the IRS also grants special relief to certain employees and related individuals who receive their Form 1095-C or Form 1095-B, as applicable, after they have filed their returns:

  • For 2015 only, individuals who rely upon other information received from employers about their offers of coverage for purposes of determining eligibility for the premium tax credit when filing their income tax returns will NOT be required to amend their returns once they receive their Forms 1095-C or any corrected Forms 1095-C.
  • For 2015 only, individuals who rely upon other information received from their coverage providers about their coverage for purposes of filing their returns will NOT be required to amend their returns once they receive the Form 1095-B or Form 1095-C or any corrections.

Thus, generally, employers should not be concerned that furnishing these Forms on a delayed basis in accordance with the Notice will force employees to file amended 2015 income tax returns.

Finally, the extensions do not require the submission of any request or other documentation to the IRS and have no effect on information reporting provisions for other years.