IRS Health Care Tax Tip 2015-80, December 8, 2015
The Affordable Care Act requires applicable large employers to file information reporting returns with the IRS and employees. ALEs are generally those employers with 50 or more full-time employees, including full-time equivalent employees in the preceding calendar year.
The vast majority of employers are not ALEs and are not subject to this health care tax provision. However, those who are must use Form 1094-C (PDF), Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and Form 1095-C (PDF), Employer-Provided Health Insurance Offer and Coverage, to report the information about offers of health coverage and enrollment in health coverage for their employees.
Here are eight things ALEs should know about the information returns they must file at the beginning of 2016.
- Form 1095-C is used to report information about each employee who was a full-time employee of the ALE member for any month of the calendar year.
- Form 1094-C must be used to report to the IRS summary information for each employer, and to transmit Forms 1095-C to the IRS.
- ALEs file a separate Form 1095-C for each of its full-time employees, and a transmittal on Form 1094-C for all of the returns filed for a given calendar year.
- Employers that offer employer-sponsored self-insured coverage use Form 1095-C to report information to the IRS and to employees about individuals who have minimum essential coverage under the employer plan.
- The information reported on Form 1094-C and Form 1095-C is used in determining whether an employer owes a payment under the employer shared responsibility provisions.
- Form 1095-C is used by the IRS and the employee in determining the eligibility of the employee for the premium tax credit.
- An ALE may satisfy this requirement by filing a substitute form, but the substitute form must include all of the information required on Form 1094-C and Form 1095-C and satisfy all form and content requirements as specified by the IRS.
- Forms 1094-C and 1095-C, or a substitute form must be filed regardless of whether the ALE member offers coverage, or the employee enrolls in any coverage offered.