November 2015

This continues our review of the ACA reporting requirements. In our previous blog Employee Benefit Advisors mentioned we decided to do a little review because we’re getting questions from employers about their reporting requirements.

Who files Form 1095-C? Sponsors of both self-insured plans and insured plans must file Form 1095-C.  Payroll providers should have the capability to report the required information.

What does Form 1095-C report? The number of full time employees for each calendar month and lists coverage information for each full time employee.

What will the IRS do with the information reported on Form 1095-C? In 2015 employers with 100 or more (50 or more beginning in 2016) full time employees (including FTEs) must provide affordable coverage that provides MEC or be subject to penalty taxes for employees who receive subsidized coverage.  The information will be used to determine whether a penalty tax is to be assessed.

Are companies with fewer than 50 full time employees required to file Form 1095-C? No, only companies with 50 or more full time employees* are required to file. However only companies with 100 full time employees* are subject to the “play or pay” penalty for 2015. In 2016 companies with more than 50 full time employees* will be subject to the “play or pay” penalty. (*Including FTEs)

What Form 1095-C filing requirements apply to FSAs, HSAs or HRAs? Some employer contributions to an FSA, HSA or HRA can count toward the calculation of minimum value and therefore may affect 1095-C filing.

Note: Our previous blog discussed 1095-B reporting. If a plan sponsor of a self-insured plan is also required to file Form 1095-C, the Form 1095-B and Form 1095-C information can be combined onto one Form 1095-C filing.

Employee Benefit Advisors provides employee benefits. We are a broker helping companies with their Health & Welfare Benefits. We also help companies revaluate PEO Services, deciding if a PEO is a good choice and if so selecting and implementing the PEO.

Employee Benefit Advisors decided to do a little review because we’re getting questions from small employers about their reporting requirements.

Who files Form 1095-B? The insurance company is required to file Form 1095-B if your company sponsors an insured plan. If self-insured, the plan sponsor is required to file Form 1095-B.

What information does Form 1095-B report? 1095-B reports the name, address and social security number of all individuals (employees, spouses, dependents and others) who are covered under an employer’s medical plan and the number of months during which the individual had at least one day of coverage.

What will the IRS do with the information reported on Form 1095-B? The IRS will use the information to verify which individuals have MEC through an employer and are therefore not subject to the individual mandate penalty tax.

Are companies with less than 50 full time employees (including FTEs) required to file Form 1095-B? Yes, the filing requirement applies to all employers who provide health coverage to their employees.

Are there 1095-B filing requirements for FSAs, HSAs or HRAs? No because by themselves they do not provide MEC.

What is the date that these forms must be filed? The forms must be filed with the IRS by February 28 (March 31 if reporting electronically) and copies of the forms must be provided to individuals by January 31.

Employee Benefit Advisors provides employee benefits. We are a broker helping companies with their Health & Welfare Benefits. We also help companies revaluate PEO Services, deciding if a PEO is a good choice and if so selecting and implementing the PEO.