Affordable Care Act Reporting
In response to the Affordable Care Act, the IRS created new reporting requirements to ensure ACA compliance under Internal Revenue Code (IRC) Sections 6055 & 6056. Now, providers of health insurance coverage must report to the IRS and their recipients using the Form 1094-B, Form 1094-C, Form 1095-B, and Form 1095-C.
Employer Shared Responsibility
The employer shared responsibility provisions, part of the ACA, state Applicable Large Employers (ALEs) must either offer Minimum Essential Coverage (MEC) of insurance to their employees or make a payment to the IRS. ALEs, or employers with at least 50 or more full-time employees, must also report the coverage offered by using the ACA reporting forms.
ACA Reporting Requirements
The reporting requirements for the ACA are in place with the IRS to ensure that all taxpayers are receiving at least the MEC of health insurance each year. The following forms are used to report this.
ACA Reporting Form 1095
- IRS ACA Form 1095-B is filed by providers of insurance to individuals during a calendar year. It contains the recipient’s name, SSN, and address, as well as month-by-month information on their coverage.
- IRS ACA Form 1095-C is filed by ALEs for their full-time employees each year. It also contains information about the recipient and month-by-month coverage.
ACA Reporting Form 1094
- IRS ACA Form 1094-B is considered as the transmittal Form of the IRS Form 1095-B and filed by filers of Form 1095-B.
- IRS ACA Form 1094-C is considered as the transmittal Form of the IRS Form 1095-C and filed by filers of Form 1095-C.
Form 1094-C and Form 1094-B is only filed with the IRS by the insurance providers and ALEs for completing their filing requirements with ACA reporting forms.
Who Needs to File ACA Forms
Under the ACA, providers of health insurance and ALEs must report to the IRS and to their recipients details of the coverage they offered. ALEs must provide this information on Forms 1094-C & 1095-C, and all other providers must report it on Forms 1094-B & 1095-B.
ACA Reporting Forms Deadlines
Paper filers have to file their forms to the IRS by February 28th, 2024.
The Recipient Copies should be furnished by March 01, 2024.
And e-filers must report to the IRS before April 01, 2024.
ACA Reporting Penalties
While the IRS is offering transition relief and exemption from penalties , if you fail to comply with the new ACA laws, you could face serious penalties in the future:
- If ALEs don’t provide MEC to at least 95% of their full-time employees, they could face a $2000 fee per employee after the first 30 employees.
- If ALEs do provide MEC to at least 95% of their full-time employees but the coverage doesn’t meet ACA standards, this fee increases to $3000 per FT employee who received premium tax credit.
- If ACA reporting forms are filed late or not at all, filers can face a penalty of up to $310 per form, not to exceed $3,783,000 per year.
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