Know Your 2016 ACA Codes
To help you better understanding of 2016 ACA codes, we’ve broken them down below by what’s new, what’s changing and what’s staying the same for each code group. Follow along below before you complete your year-end filings or feel free to use these details as a quick refresher to check the information you’ve already completed.
As always, one quick disclaimer: This blog is meant to address the codes and not specific instances or uses as they relate to your organization. We recommend contacting your benefits broker or accountant to discuss any specific circumstances or questions.
2016 ACA Codes: What’s New
Probably the biggest news is that there are two new Series 1 codes for line 14 – 1J and 1K. Both address when the offer of coverage to a spouse is conditional but have different details regarding dependent coverage. So, what is a conditional offer? It’s coverage that is offered to a spouse only if he/she does not have an offer from another employer. There may be other examples, but this seems to be the most common. As far as details go:
• 1J: Code 1J should be used when an employee was offered coverage for all days of the month which 1.) provided MEC and MV to the employee, 2.) provided at least MEC to his/her spouse that was a conditional offer but that 3.) did not provide coverage to the dependents of the employee.
• 1K: Code 1K should be used when an employee was offered coverage for all days of the month which 1.) provided MEC and MV to the employee, 2.) provided at least MEC to his/her spouse that was a conditional offer but that 3.) did provide coverage to dependents of the employee.
2016 ACA Codes: What’s Gone
With a year under our belts, the IRS was able to get rid of a few codes associated with 2015 transition relief. The below codes (now marked as “Reserved” on the instructions) are no longer available for use on the 2016 Form 1095-C:
• 1I: Code 1I referred to 2015 Qualifying Offer Method transition relief and is no longer valid.
• 2I: Code 2I referred to Non-Calendar Year transition relief and is no longer valid.
2016 ACA Codes: What’s Staying the Same
If you’ve done your homework and know last year’s codes then you’re in great shape. That’s because, other than these 4 changes, all other codes are staying the same. We recommend taking a closer look at each in the Form 1095-C filing instructions.