IRS Provides Extension for Form 1095-C (and a simpler method for Form 1095-B)

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Today, the IRS released Notice 2019-63 to extend the due date for employers to furnish 2019 Form 1095-C or 1095-B under the Affordable Care Act’s employer reporting requirement. Employers will have an extra month to prepare and distribute the 2019 form to individuals. The due dates for filing forms with the IRS are not extended.

The notice also provides a simpler option for insurers and small self-funded employers to furnish Form 1095-B to individuals. If certain conditions are met, the entity may post a notice on its website that the form is available upon request. This option relieves the insurer or small self-funded employer from the burden of printing and mailing the form to each primary enrollee who received coverage in 2019. Apparently the IRS has become less concerned about individuals receiving this coverage statement in writing now the ACA’s individual mandate penalty is reduced to zero.

Background

Applicable large employers (ALEs), who generally are entities that employed 50 or more full-time and full-time-equivalent employees in 2018, are required to report information about the health coverage they offered or did not offer to certain employees in 2019. To meet this reporting requirement, the ALE will furnish Form 1095-C to the employee or former employee and file copies, along with transmittal Form 1094-C, with the IRS.

Employers, regardless of size, that sponsored a self-funded (self-insured) health plan providing minimum essential coverage in 2019 are required to report coverage information about enrollees. To meet this reporting requirement, the employer will furnish Form 1095-B to the primary enrollee and file copies, along with transmittal Form 1094-B, with the IRS. (Insurers and non-ALE self-funded employers may avoid printing and mailing Form 1095-B to each recipient if they meet the conditions explained under “Relief from Penalties” below.) Self-funded employers who also are ALEs are instructed to use Forms 1095-C and 1094-C (instead of Forms 1095-B and 1094-B) regarding full-time employees.

Extended Due Dates

Notice 2019-63 extends the deadline for furnishing 2019 Form 1095-C, or Form 1095-B, if applicable, to employees and individuals from January 31, 2020 to March 2, 2020.

The deadline for filing copies of the 2019 Forms 1095-C, along with transmittal Form 1094-C (or copies of Forms 1095-B with transmittal Form 1094-B), if applicable, remains unchanged:

  • If filing by paper, February 28, 2020.
  • If filing electronically, March 31, 2020.

The extended due date applies automatically so employers do not need to make individual requests for the extension.

Relief from Penalties

The IRS is extending transitional good-faith relief from certain penalties to the 2019 employer reporting requirements.

Additionally, the IRS now offers a simpler option for insurers and small self-funded employers to provide Form 1095-B to individuals. Notice 2019-63 states that the IRS will not access penalties on the “reporting entity” (i.e., the insurer or non-ALE self-funded employer) for failing to furnish Form 1095-B to a “responsible individual” (i.e., intended recipient) provided the following two conditions are met:

  1. The reporting entity posts a notice prominently on its website stating that individuals may receive a copy of their 2019 Form 1095-B upon request, accompanied by an email address and a physical address to which a request may be sent, as well as a telephone number that responsible individuals can use to contact the reporting entity with any questions; and
  2. The reporting entity furnishes a 2019 Form 1095-B to any responsible individual upon request within 30 days of the date the request is received.

Note that self-funded employers that also are ALEs (due to their size) will continue to furnish Form 1095-C (not Form 1095-B) to individuals who were full-time employees for any month in 2019. The new “website” option is only available for Form 1095-B which is used by insurers and non-ALE self-funded employers. Lastly, the requirements for filing copies of Forms 1095-B and 1095-C with the IRS have not changed.

Get It All

ThinkHR customers can find a wealth of information about the employer reporting rules and other ACA requirements by logging on to Comply.

Kathy Berger

Kathy Berger is ThinkHR’s principal benefits consultant. She is a Certified Employee Benefits Specialist (CEBS) with over 25 years of experience working with brokers and employers. Kathy uses her extensive knowledge of ERISA, HIPAA, the ACA, and other benefits laws and regulations to assist our clients with practical information in clear language.

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