IRS Releases Final Forms and Instructions for PPACA Reporting

The IRS has released the final forms to be used to report health coverage for employees. The reporting requirements were added by the Patient Protection and Affordable Care Act (PPACA) and are effective for the 2015 calendar year. To satisfy their reporting requirements under Sections 6055 and 6056, Applicable Large Employers (ALEs) with 50 or more full-time or full-time-equivalent employees (FTEs) will use the following forms:

  • Form 1094-C Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns
  • 1095-C Employer-Provided Health Insurance Offer and Coverage

Draft forms were issued back in August of 2014, and while the forms are nearly identical, there were some changes to the final instructions. These include:

  • Employers with 50 to 99 FTEs who are exempt from the employer shared responsibility penalties in 2015 are still required to file for 2015.
  • Offer of coverage to a spouse that is subject to a reasonable, objective condition (such as no coverage if available through spouse’s employer), is treated as an offer of coverage for reporting purposes.
  • Employers that cover non-employees (COBRA beneficiaries and retirees) may use forms 1094-B and 1095-B instead of filling out Part II of Form 1095-C for those individuals.
  • ALEs are required to report their total number of employees. Final instructions provide a method, which is to count the number of employees as of the first or last day of the first payroll period starting in the calendar month.
  • ALEs may be part of a “consolidated group.” If an employee works for more than one member of that group, the employee is treated as the employee only of the ALE member for which that employee worked the greatest number of hours for the month. Only the ALE member treated as the employer for the month would report on Form 1095-C for that employee for that month.

This is intended to be a very broad overview of the reporting requirements and the changes to the instructions on the required forms. Please visit the IRS website or a specialist in this area with questions when preparing your forms. IRS has published a brochure to assist ALEs in this process, as well. Information is also available on MSEC’s Health Care Reform Learning Zone.