The Affordable Care Act (ACA) created new reporting requirements under Internal Revenue Code sections 6055 and 6056. Under these new reporting rules, certain employers must provide information to the IRS about the health plan coverage they do or do not offer to their employees.
Employers that are subject to the ACA employer “shared responsibility” mandate will use the new forms to report health insurance coverage offered under employer-sponsored plans in accordance with Section 6055 & 6056 of the Internal Revenue Code. These forms include the Information Reporting Forms 1094-B and 1095- B and Forms 1094-C and 1095-C.
Overview
| Type of Reporting | Affected Employers | Required Information | Effective Date |
|---|---|---|---|
| Code § 6056 – Large employer health coverage reporting | Large employers (at least 50 full-time employees, including full-time equivalents) | Terms and conditions of health plan coverage offered to full-time employees (helps the IRS administer the ACA’s shared responsibility penalty for large employers) | Delayed until 2015 |
| Code § 6055 – Reporting of health coverage by health insurance issuers and sponsors of self-insured plans | Employers with self-insured health plans | Information on each individual provided with coverage (helps the IRS administer the ACA’s individual mandate) | Delayed until 2015 |
Who Must File
• Every person who provides minimum essential coverage to an individual during a calendar year must file an information return and a transmittal.
• Forms 1094-B and 1095-B are used to report information to the IRS and taxpayers regarding individuals who are covered by minimum essential coverage.
• Forms 1094-C and 1095-C are used to report information to the IRS and taxpayers regarding individuals who are covered by minimum essential coverage, and who are subject to the employer shared responsibility provisions (self-insured plan).
In general, an employer with 50 or more Full-time employees (including full-time equivalent employees) during the prior calendar year is subject to the employer shared responsibility provisions.
Dates/Deadlines
• The IRS requires that the forms be filed by February 28, 2016 for calendar year 2015. (March 31 if filed electronically). Employers with more than 250 employees will be required to file this report electronically.
• The health insurance provider must also provide a statement by mail to the last known permanent address by January 31 of the year following the calendar year in which minimum essential coverage is provided. (Similar to W-2 rules). You can also provide it electronically using the same notice requirements as W-2s. Forms provided to recipients can truncate the SSN but they cannot be truncated on the IRS forms.
• Forms 1094-B and 1095-B are not required to be filed for 2014. However, IRS has indicated that in preparation for the first required filing of these forms (that is, filing in 2016 for 2015), reporting entities may, if they wish, voluntarily file in 2015 for 2014 in accordance with the forms and instructions.
Types of Forms:
• Form 1094-B (Transmittal) and Form 1095-B (return) will be used by most filers.
• Form 1094-C and Form 1095-C are used by those employers sponsoring self-insured group health plans
What Information is required on the form?
• Name, address, EIN of provider.
• The responsible individual (Policy Holder): Name address and TIN, date of birth if TIN is not available.
• The name and TIN or date of birth if TIN is not available of each individual covered under the policy or program and the months for which the individual was enrolled in coverage and entitled to receive benefits.
• For coverage provided by a health insurance issuer through a group health plan, the name, address, and EIN of the employer sponsoring the plan and whether the coverage is a qualified health plan enrolled through the SHOP (Small Business Health Options Program), and the SHOP’s identifier.
Health insurance providers can hire a third party to fulfill the provider’s reporting requirements. However, entering into a reporting arrangement does not transfer the potential liability of the provider for failure to report information or furnish statements.
An employer is NOT required to report under section 6055 if it sponsors a health plan that provides coverage by purchasing insurance from a health insurance issuer. An employer that sponsors an insured health plan (a health plan that provides coverage by purchasing insurance from a health insurance issuer) will not report as a provider of health coverage less than 6055. The health insurance issuer or carrier is responsible for reporting that health coverage. However, if the employer is subject to the employer shared responsibility provisions in section 4980H, it is responsible for reporting information under section 6056 about the coverage it offers to its full-time employees.
It would appear that those who qualify as large employers will need to do this reporting and others will be reported by the insurance carrier.
Open Enrollment
November 15, 2014 marked the second open enrollment opportunity for the Affordable Care Act. This is a three-month open enrollment period (closes February 15, 2015) that allows anyone to purchase insurance from the exchange. Unless a qualifying event occurs, most individuals will have to wait a full year before they have this opportunity again.
For more information about the Affordable Care Act, visit the IRS website at IRS.gov.
