United Benefit Advisors Insight and Analysis Blog

Affordable Care Act Information Returns

By Danielle Capilla, Senior VP of Compliance and Operations, United Benefit Advisors
  Sep 15, 2015 8:38:15 PM

Under the Patient Protection and Affordable Care Act (ACA), individuals are required to have health insurance while applicable large employers (ALEs) are required to offer health benefits to their full-time employees. In order for the Internal Revenue Service (IRS) to verify that (1) individuals have the required minimum essential coverage, (2) individuals who request premium tax credits are entitled to them, and (3) ALEs are meeting their shared responsibility (play or pay) obligations, employers with 50 or more full-time or full-time equivalent employees and insurers will be required to report on the health coverage they offer. (If ALEs are not offering coverage, they will have to report on that, too).

Reporting will first be due early in 2016, based on coverage in 2015. All reporting will be for the calendar year, even for non-calendar year plans. Mid-size employers (those with 50 to 99 employees) will report in 2016, despite being in a period of transition relief in regard to having to offer coverage. The reporting requirements are in Sections 6055 and 6056 of the ACA. Sections 6055 and 6056 reporting is done on IRS Forms 1094-C, 1095-C, 1094-B, and 1095-B.

For calendar year 2015, the required forms must be filed by February 29, 2016, or March 31, 2016, if filing electronically. Employers with 250 or more 1095 Forms must file electronically with the "Affordable Care Act Information Returns" or AIR. The IRS is encouraging all entities to file electronically. Employers utilizing a vendor service should confirm that the service they are using can handle the act of reporting, electronic or otherwise. Employers using a vendor should confirm that their chosen vendor is set up to file the returns for them, and have or will have successfully completed the testing phase. Employers who wish to use a vendor instead of filing themselves should be aware that many of the reporting vendors have a capped amount of clients they can assist.

Employers who are doing their own electronic filing should ensure they are ready to use the AIR system. Being ready to use the system is a time-consuming process; ample time should be given to ensure an employer is up and running.

For detailed information on the steps employers should follow to use AIR, download UBA’s ACA Advisor, “Affordable Care Act Information Returns”...

Topics: ACA, Danielle Capilla, employer-shared responsibility reporting, Affordable Care Act Information Returns, applicable large employers, ACA Section 6055, ACA Section 6056