ACA Reporting Advisor

Welcome to MSEC’s weekly ACA FAQ on reporting. While details on how to complete IRS forms 1094 and 1095 (such as what codes to use on specific lines of the form) will not be covered, general questions on reporting requirements will be answered. For detailed information on form completion, contact your broker, tax advisor, payroll company, or insurance carrier. If you have a general ACA reporting question, email it to aca@msec.org. The most commonly asked questions will be answered in this forum. In addition, the Health Care Reform Learning Zone, found on the MSEC website (msec.org), is a rich source of information about the Affordable Care Act (ACA).

Q: My organization has fewer than 50 full-time/full-time-equivalent employees. Do we need to file any IRS reports under the Affordable Care Act?

Possibly. It depends on your company’s situation.

No reporting required: If you do not offer group health coverage of any kind.

Insurance carrier completes the reporting: If your organization sponsors a fully insured group health plan, your carrier will file the 1095-B and 1094-B forms for your company.

Employer completes the reporting if one of the following applies:

  • Your health plan is self-insured or partially self-insured
    • Complete the 1095-B and 1094-B reports
  • Your company’s owner(s) also own other companies, and the total number of employees between all commonly owned companies is 50 or more full-time plus full-time-equivalent employees
    • You may be an Applicable Large Employer and required to file the ALE reports (IRC Sec 6056)
  • Your employees are part of a “multiemployer” plan—meaning if you have union employees who participate in the union-sponsored health plan
    • Contact your multiemployer plan’s administrator to coordinate filings

If none of the above situations exists, you would not need to file any IRS reports yourself.

Q: My organization has a number of “temporary” employees who work full time and are paid on our payroll. Do we need to do any IRS reporting for them?

“Temporary” is a status organizations often use to identify employees hired either full-time or part-time but for a short duration and paid on the company payroll. Temporary employees have generally been excluded from participating in benefit plans. (This status does not include individuals working through a staffing agency.)

The Affordable Care Act does not recognize “temporary” as an employee status for excluding an employee from health plan eligibility. Consequently, if your organization is an Applicable Large Employer (ALE)* and you wish to avoid the possibility of a penalty, temporary employees should be offered health coverage if they are working full-time (130 hours per month) and meet your health plan’s waiting period.

ALEs must complete a 1095-C form for each temporary employee who worked full-time (130 hours per month) for at least one month during 2015 for your organization, whether or not you offered them health coverage and even if they terminated before the health plan waiting period was met.

Lastly, don’t forget to update your health plan documents or insurance contract to include coverage for full-time temporary employees if you wish to avoid the possibility of a penalty. No penalty applies if you do not offer a full-time temporary employee “excepted,” stand-alone benefits like dental, vision, life insurance, or disability benefits.

*ALE = employer with 50 or more full-time plus full-time-equivalent employees