The IRS has released finalized forms and instructions for employers subject to the new information reporting requirements under the Affordable Care Act (ACA):
- Forms 1094-C and 1095-C will be used by large employers (generally those with at least 50 full-time employees, including full-time equivalents) to report information to the IRS and to their employees about their compliance with “pay or play” and the health care coverage they have offered.
- Forms 1094-B and 1095-B will be used by self-insuring employers (regardless of size) and other parties that provide minimum essential health coverage to report information on this coverage to the IRS and to covered individuals.
- Note: Employers that are subject to both reporting provisions (generally large employers that sponsor self-insured group health plans) are permitted to satisfy their reporting obligations on Form 1095-C, which has separate sections for reporting.
Information reporting was voluntary for calendar year 2014. Affected employers are required to report for the first time in early 2016 for calendar year 2015.
Employer Action Items for 2015
To help complete the new IRS forms for 2016, large employers need to track certain information for each month in 2015, including whether the employer offered full-time employees and their dependents (if any) minimum essential coverage that meets the ACA’s minimum value requirements and is affordable. An employee is full-time for a calendar month if he or she averages at least 30 hours of service per week (or 130 hours per month). The “pay or play” regulations explain the detailed rules on determining who is a full-time employee. Self-insured employers need to track, among other things, the months for which each individual was enrolled in coverage and entitled to receive benefits.