Form(s) and Function – Affordable Care Act Reporting Requirements

By: Dave Lewis, Executive Vice President

We might be a few months from December 31, but our service team is already fielding an awful lot of calls regarding the topic of year-end reporting, specifically Affordable Care Act (ACA) reporting requirements. At this year’s SHRM Annual Conference and Expo, we learned that our clients aren’t alone in their quest for information, as ACA reporting once again dominated a bulk of the conversations we had with those in attendance.

Form Types and Filing Deadlines

Much like the current W-2 reporting process, the ACA mandates that employers follow a similar path, providing both an informational and transmittal form. Employers must provide individual employees with the informational form – a 1095 – and file their required information with the IRS using one transmittal form – a 1094. A version of these forms – for example and 1094-B and 1095-B – need to be completed and distributed or filed before their specific filing deadlines.

For the transmittal form, that filing deadline is February 28 or, if filing digitally, March 31, 2016. The informational deadline is a bit closer as the IRS requires that employees receive a copy of their informational form or a substitute statement by January 31. Forms can be filed electronically via the Internal Revue Service’s new Affordable Care Act Information Returns (AIR) program.

Employers who fail to meet these deadlines may face penalties of $250 per form up to $3 million!

What Forms Do I Need to File?

The answer to this question is a tough one because it depends on a couple deciding factors, the first of which is your applicable large employer (ALE) status.

If you’re classified as a small employer – less than 50 full-time employees (including full time equivalents (FTEs)) – that isn’t self insured it’s easy; you don’t need to file anything. However, if you’re a small employer that is self insured, you’ll need to file forms 1095-B (informational) and 1094-B (transmittal) to report the name, address and Social Security Number (or date of birth) of employees and any family members who have coverage under your self-insured plan.

If you classify as an ALE – those employers who have at least 50 full-time employees, including FTEs – then you’ll need both the form 1095-C (informational) and form 1094-C (transmittal) to show employer-provided health insurance offered and specific coverage information.

One important thing to note here is that ALL large employers are required to file these forms regardless of whether your company offers an insured or self-insured plan, or doesn’t offer any group health plan.

I’m Not an ALE, Right?

Here’s where things can get a little tricky. Small employers are required to file forms 1094-C (informational) and 1095-C (transmittal) only if they are members of what the IRS calls a controlled or affiliated service group that together, has at least 50 full-time employees, including FTEs. A company may qualify as a controlled or affiliated service group if they have common owners, provides services for each other or work together to provide third parties.

Specifically, there are three types of controlled groups: Parent-subsidiary, brother-sister or a combination of the two. Since this can get a bit confusing, I’d recommend checking out this article from the IRS that goes into greater detail and provides a few examples of each type of controlled group. If you still aren’t sure of your status as a controlled group, I’d recommend contacting your accountant who should be able to help.

Choosing the Right Form

By now we hope you have a better handle on your company status and the forms necessary to maintain compliance but, because we know it’s sometimes better to show than tell, have included a helpful chart below to illustrate who should file what.

See where you fit in based on the below parameters and start planning accordingly. If you’re a Sentric client, rest assured that wherever you fit, we’ll be there to help you meet your needs.

If you still have questions or need a hand sorting through ACA requirements just give us a call and we’ll be happy to help. In the meantime, be sure to check back here for updates or stop by the Industry Insights page within our Resources section for upcoming webinars and training opportunities.

Employer SizeLarge Employer?Employer Health PlanEmployer Files Forms 1094-B/1095-BEmployer Files Forms 1094-C/1095-C
SmallNoNoneNoNo
SmallNoInsuredNo(insurer to file)No
SmallNoSelf InsuredYesNo
Controlled or Affiliate GroupYesNoneNoYes
Controlled or Affiliate GroupYesInsuredNo(insurer to file)Yes
Controlled or Affiliate GroupYesSelf InsuredNo*Yes
LargeYesNoneNoYes
LargeYesInsuredNo(insurer to file)Yes
LargeYesSelf InsuredNo*Yes

*Companies with non-employees who are enrolled in their self-insured health plans – including directors, retirees and individuals on COBRA – can elect to report these individuals on forms 1094-B and 1095-B rather than forms 1094-C and 1095-C.

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