Employer Shared Responsibility – Draft Reporting Forms Released

August 11, 2014

The IRS requires detailed reporting for all large employers, starting with the 2015 calendar year. The first year reports are to be filed in January 2016.

Under the ACA, a large employer is any employer with at least 50 full-time equivalent employees in the prior calendar year. Note that large employers who are not yet subject to the Employer Shared Responsibility (§4980H) rules in 2015 under transition relief would still be required to file IRS reports for the calendar year 2015.

The IRS recently issued draft forms for employers and insurers.  Instructions have not been issued yet, but the draft forms indicate the following:

Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns – filed with IRS

Employers will report their full-time employee count for each month in the calendar year and a total employee count. For each affected month, the employer is able to indicate whether it was 50-99 FT employees (and not subject to Section 49080H until 2016) or 100 FT employees (and possibly not subject to 4908H that month because the plan renewal date is later in the year). We do not understand why the IRS is not using the term “full-time equivalent” employees for this definition.

Form 1095-C: Employer-Provided Health Insurance Offer and Coverage – filed with IRS and each employee

Employers will report each employee’s offer/affordability/enrollment status by month, using 18 different codes, as well as the employee’s share of the lowest cost single premium available, by month. If the criteria is the same for each month for that employee, an “All 12 Months” section would be used.

Employers with a self-insured medical plan will also provide the names for each covered individual, SSN, and months covered. This is necessary for enforcement of the individual responsibility to have health insurance (since there will be no carrier issued forms to these individuals).

Insurance carriers must report similar information to both the IRS and covered individuals in order for the IRS to enforce the individual responsibility to maintain health coverage. Insurers will be filing the Form 1094-B Transmittal of Health Coverage (to the IRS) and Form 1095-B Health Coverage (to the IRS and covered employee).

The IRS is currently taking comments on the forms before they are finalized. If you have comments, please provide them to your Keller consultant for submission or go directly to: IRS Comments.