ACA Employer Reporting Requirements Required by IRS

ACA Employer Reporting Requirements Required by IRS

Employer Shared Responsibility Provision, a.k.a. “Pay or Play”

The Internal Revenue Service (IRS) released the 2014 forms and instructions to be used in reporting health insurance coverage offered by applicable employers, and minimum essential coverage by insurers and employers of self-insured plans.  Employers should become familiar with the reporting requirements and update their systems and processes in order to start tracking the required data for the 2015 calendar year.

Insurers and employers have two forms they must provide the IRS. Each must provide a form that serves as a cover letter as well as forms providing data on the individual or employer mandate.  The forms must be filed with the IRS annually, no later than Feb. 28 (March 31, if filed electronically) and furnished to full-time employees or responsible individuals by January 31. The information on the form pertains to the prior calendar year and the first forms are due in 2016 (for the 2015 calendar year).


Section 6055- Minimum Essential Coverage (MEC) reporting (coverage that satisfies the individual mandate)

What’s reported:  Information about the entity providing coverage, including contact information; which individuals are enrolled in coverage, with identifying information and the months for which they were covered.

Requires employers with self-funded health plans and Insurers (for fully insured health plans) to report

·         MEC data to the IRS

·         MEC statements to employee

How to report:   Forms available are for 2014

·         Self-funded health employers who are not considered *Applicable Large Employer, health insurance issuers, self-insured multiemployer plans, and providers of government-sponsored coverage provides Form 1095-B and Form 1094-B transmittal page.   Instructions for completing Forms 1095-B and 1094-B are also available.

·         Self-funded Applicable Large Employers are required to comply with both IRS Sections 6055 and 6056 thru combined reporting by completing 
Form 1095-C  and Form 1094-C transmittal page only. Parts I, II and III of form 1095-C must be completed.

Section 6056- Employer Mandate reporting

What’s reported:  Information about the employer offering coverage (including contact information and the number of full-time employees).  For each full-time employee, information about the coverage (if any) offered to the employee, by month, including the lowest employee cost of self-only coverage offered.

Requires all *Applicable Large Employers to report:

·         whether or not they are providing minimum value,

·         affordable coverage to their full-time employees

How to report:   Forms available are for 2014

·         Employer Mandate data to the IRS using Form 1094-C transmittal page  using either the general reporting method or one of five alternative reporting methods.

·         Statements to employees using Form 1095-CIf its plan is fully insured, the employer will only complete Parts I and II of Form 1095-C.  Instructions for completing Forms 1095-C and 1094-C are also available.

 In order to qualify for the 2015 transitional relief, mid-size employers (50 to less than 100 FTEs) must certify to the IRS that it meets the necessary requirements. Form 1094-C is also used to certify that the mid-size employer meets these requirements.


Prepare for Reporting

Failure to timely and correctly report information may result in reporting penalties.  Employers should prepare now to collect the following information for each calendar month starting 2015:

  • Name, address, and taxpayer identification number (TIN) of each full-time employees during the calendar year and the months, if any, during which the employee was covered under the plan.
  •  Name, address, TIN of each individual covered (required for reporting section 6055).
  • Certification as to whether the employer offered its full-time employees and their dependents the opportunity to enroll in MEC under employer’s plan by calendar month.
  • Names and employer ID numbers (EINs) of other employers within the reporting employer’s controlled group of corporations for each month of the calendar year.
  • Number of full-time employees for each calendar month.
  • Total number of employees (full-time equivalents) for each calendar month.
  • Employer Mandate transition relief indicators for each calendar month.
  • Employees’ share of the lowest-cost monthly premium for self-only, minimum value coverage for each calendar month.
  • Applicable Employer Mandate safe harbors for each calendar month.


*An applicable large employer (ALE): employs an average of 50 or more full-time employees or full-time employee equivalents in the prior calendar year.