IRS Extends Deadline for Providing Health Coverage Forms to Employees under the ACA, But Not the IRS Filing Deadline
Under the Affordable Care Act (“ACA”), large employers (generally those with 50 or more full-time employees or full-time equivalents) must report annually to the IRS information about the health coverage offered to their full-time employees during the prior year using IRS Form 1095-C. The IRS uses the forms to assess whether an employer "shared responsibility" penalty applies. Employers also must provide copies of the forms to their full-time employees.
In Notice 2018-94, the IRS extended the deadline for providing Forms 1095-C to employees to report coverage provided in 2018, although the notice did not extend the deadline for filing the forms with the IRS. Generally, employers must furnish copies of Forms 1095-C to full-time employees by January 31, for offers of coverage made in the prior year. The IRS extended the 2019 deadline for providing Forms 1095-C to employees from January 31, 2019 to March 4, 2019.
The annual IRS filing deadline for Forms 1095-C, and transmittal Form 1094-C, is February 28, or March 31, if filing electronically. Notice 2018-94 did not extend the deadline for filing these forms with the IRS, meaning 2018 forms must be filed by February 28, 2019, or April 1, 2019, if filing electronically. However, as in previous years, employers may submit IRS Form 8809 on or before the due date to obtain an automatic 30-day extension, and may request an additional 30-day extension if hardship conditions apply. Instructions for Forms 1094-C and 1095-C may be found online.
Notice 2018-94 also extended the transitional penalty relief for certain failures to comply with the reporting requirements. Generally, an employer that fails to file, or files incomplete or incorrect Forms 1095-C, may be subject to a penalty of up to $260 per form, capped at an annual maximum of $3,218,500, or higher amounts if the IRS determines that the failure was due to the employer’s intentional disregard of the filing requirement. Similar penalties apply for a failure to provide complete and correct copies of the forms to employees. In previous years, the IRS provided penalty relief for employers that could show they made a good-faith effort to comply with the reporting requirements. Notice 2018-94 extends this penalty relief for the 2019 filing year. As in previous years, no relief will be granted for employers that fail to timely file the forms or provide copies to full-time employees.
While the Tax Cuts and Jobs Act (Public Law 115-97) effectively repealed the ACA's individual mandate, effective January 1, 2019, the law did not affect the employer requirements of the ACA. This means that large employers continue to face penalties if they fail to offer qualified, affordable coverage to full-time employees and their dependent children, or fail to timely provide Forms 1095-C to employees and file the forms with the IRS.
If you have any questions regarding the reporting requirements under the ACA, please contact a member of the Hanson Bridgett Employee Benefits Group.
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