On, Monday, December 28th, 2015, the IRS released Notice 2016-4 which provides for a two month delay in the deadline for furnishing Forms 1095-B & 1095-C. The original February 1st deadline to issue forms to employees has now been extended to March 31st. In addition to the delay in employee notification, subsequent notification to the IRS has also been pushed back to May 31st for those filing by mail or June 30th, 2016 for those filing electronically.
1095-C & 1094-C
As a reminder, Form 1095-C is to be used by employers with 50 or more full-time employees (including full-time equivalent employees) known as applicable large employer (ALE) to report information required under section 6055 and 6056 to the IRS. Form 1095-C must also be furnished to covered employees. (Form 1095-C is transmitted to the IRS using Form 1094-C.) This form is required to be used by ALEs for the combined reporting of Minimum Essential Coverage (MEC) under section 6055 and the offer of coverage under section 6056 to the IRS. The form will be used by:
- Large Employers that sponsor a self-funded plan: The employer completes Parts I and III of the 1095-C for any employee that enrolls in the health coverage, whether or not the employee is a full-time employee. If the employee is a full-time employee, the employer must also complete Part II. Part II of the form includes information about the offer of coverage that was made to the employee, the employee’s share of the lowest cost monthly premium, and other employer responsibility information.
- Large Employers that provide fully insured coverage: The employer completes Parts I and II of Form 1095-C, but does not complete Part III of the form. Part III of the form reports information about the MEC and will be separately reported to the IRS by the entity providing the coverage (the fully insured carrier)
- The 1094-C is the cover page that is sent to the IRS along with the 1095-C
1095-B & 1094-B
Form 1095-B is the return used for reporting MEC (Minimum Essential Coverage) under section 6055 to the IRS and for furnishing coverage information to covered individuals. (Form 1095-B is transmitted to the IRS using Form 1094-B.) Insurance companies that issue policies in the small group market are responsible for filing the 1095-B (this means that small employers that are self-funded must issue the 1095-B.
Who sends what:
- Small Employer that is FULLY INSURED with less than 50 full time equivalents:
- the insurance company will provide the 1095-B to enrolled employees.
- The employer does not need to report or file anything.
Small employer that is SELF FUNDED with less than 50 full time equivalents:
- Employer will send form 1095-B to both the IRS and the Employee
- Employer will transmit the 1095-B to the IRS using the form 1094-B
Large Employers that is FULLY INSURED:
- Insurance Company will supply the 1095-B to both the IRS and the enrolled employee
- Employer will send form 1095-C (but only complete sections I & II) to both the IRS and the Employee that was deemed eligible for benefits
- Employer will transmit the 1095-C to the IRS using the form 1094-C
Large Employer that is SELF FUNDED:
- There is NO 1095-B form for self-funded large employers
- Employer will send form 1095-C (complete ALL sections) to both the IRS and all benefit eligible employees
- Employer will transmit the 1095-C to the IRS using form 1094-C
As always, GDP Advisors will continue to monitor future developments from the Federal Government regarding all rules and regulations surrounding the Affordable Care Act. If you have any questions, please contact you GDP Advisors representative.