Prepare for PPACA Reporting Requirements Now

IRS Code 6055 requires sponsors of self-funded health plans to file reports with the IRS to verify whether an individual had minimum essential coverage during a given calendar year to satisfy the individual mandate. IRS Code 6056 requires an applicable large employer to file reports with the IRS to verify whether it offered minimum value and affordable coverage to full-time employees and their dependents in a given calendar year to satisfy the employer mandate.

Due Dates

Reporting is due annually, after the end of the calendar year to which it relates. Reporting Forms reflecting 2015 information are due to the IRS by February 29, 2016, or March 31, 2016 if submitted electronically. Employers that are required to file at least 250 Reporting Forms must file electronically, although the IRS encourages all employers to file electronically.

Reporting Forms

Form 1095-C provides information about health insurance and is sent to both employees and the IRS, and Form 1094-C acts as a transmittal form/cover sheet about Forms 1095-C and is sent only to the IRS. ALEs with self-funded plans must send Form 1095-C to all employees eligible for coverage (regardless of whether they elect coverage). This statement provides details about the coverage offered, the lowest-cost premium available to the employee, and the months of the year when the coverage was available. Employers must send the Forms 1095-C to the IRS as well, and when they do, they also file Form 1094-C for transmittal. Form 1094-C provides information about the employer, the number of employees, the name of a contact person, and the number of forms being sent.

Small employers (those not subject to the employer shared-responsibility provisions) with self-funded health plans will file Form 1095-B with the IRS and employees to report individuals who are covered by minimum essential coverage. Form 1094-B is the transmittal form that must be filed with the Forms 1095-B to the IRS.

Electronic Filing

The IRS has provided information on the process for electronic reporting, known as the ACA Information Return (AIR) system. Employers are required to complete the following steps before submitting Reporting Forms electronically:

1. Register with the IRS’s e-services Website, including submission of personal information about the person registering for the Submitting Entity.

1. Obtain an AIR Transmitter Control Code (TCC), a unique identifier authorizing each submitting entity to submit the Reporting Forms.

1. Pass a series of technical/system tests to ensure that reporting Forms will be properly submitted when due.

The first two steps can be completed now. The third step is anticipated to become available later this year. The IRS has developed a Website for Submitting Entities to get an early start on the registration process: http://www.irs.gov/for-Tax-Pros/Software-Developers/Information-Returns/Affordable-Care-Act-Information-Return-AIR-Program .

Penalties

The penalty for failure to file Reporting Forms is $250 per return, and the total amount imposed for all such failures to file is $3,000,000 ($1,000,000 for employers with gross receipts under $5,000,000). These penalties apply to both the Reporting Forms filed with the IRS and the statements provided to individuals.

Assistance from ASR

In order to assist clients in submitting Reporting Forms, ASR is providing data via our Website. Employers will select a month or a calendar year, and the Web program will return an Excel spreadsheet with employee information necessary to complete Part I Employee and Part III Covered individuals of Form 1095-C. This new Web function will be available on July 31, 2015.

If you have questions about the reporting requirements, call ASR Health Benefits at (616) 957-1751 or (800) 968-2449.