Under the Affordable Care Act (ACA), applicable large employers (generally those with 50 or more full-time employees in the previous year) must furnish each individual who was a full-time employee during 2016 with a Form 1095-C, Employer-Provided Health Insurance Offer and Coverage. The deadline for furnishing these statements to full-time employees to report coverage during 2016 was originally Jan. 31, 2017. In Notice 2016-70, the Internal Revenue Service (IRS) has extended that deadline by 30 days until March 2, 2017.

In addition, applicable large employers must also file a Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, with the IRS to report the same information provided to full-time employees on Form 1095-C. The deadline for filing these statements with the IRS has not been extended. The deadline is Feb. 28, 2017 if not filing electronically, or March 31, 2017 if filing electronically.

Form

Recipient

Original Due Date

Extended Due Date

2016 Form 1095-C

Employees

Jan. 31, 2017

March 2, 2017

2016 Form 1095-B and 1095-C, if not filing electronically

IRS

Feb. 28, 2017

None

2016 Form 1095-B and 1095-C, if filing electronically

IRS

March 31, 2017

None

Under regulations, the IRS may grant extensions of up to 30 days for furnishing the statements to employees. These extensions will not apply to the extended due date.

For 2016, an employee may rely on other information received from employers about the offers of coverage for purposes of determining eligibility for the premium tax credit when filing an individual tax return. Such an employee will not be required to file an amended return upon receiving the Form 1095-C.

Similarly, Forms 1095-B and 1095-C are also used to confirm that individuals had minimum essential coverage for purposes of the premium tax credit provisions and individual mandate penalty. For 2016, individuals who rely upon other information received from coverage providers for purposes of filing an individual tax return will not be required to file an amended return upon receiving Form 1095-B or 1095-C.

In this guidance, the IRS also extended its “good faith” transition relief from penalties associated with the late furnishing of returns to individuals and filing of these returns with the IRS. For 2016 returns, there will be no penalties if the employer makes a “good faith” effort to comply. The relief applies to incorrect or incomplete information, but does not apply to the failure to timely furnish or file the returns, although the IRS may waive late filing penalties if the failure is due to “reasonable cause.”

Since compliance in 2016 to report coverage in effect in 2015 proved to be very challenging for many employers, this 30-day automatic extension will be welcome, but might not be enough.