Under the Affordable Care Act (ACA), applicable large employers (generally 50 or more full-time employees in previous year) must furnish each individual who was a full-time employee during 2015 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 2015 was originally February 1, 2016. In Notice 2016-4, the Internal Revenue Service (IRS) has extended that deadline by two months until March 31, 2016.
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 was originally February 29, 2016 if not filing electronically, or March 31, 2016 if filing electronically. These deadlines have been moved to May 31, 2016 if not filing electronically and June 30, 2016, if filing electronically.
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In the instructions to these forms, the IRS provided that an employer could apply for a 30-day extension from the February 1, 2016 deadline for furnishing the statements to employees. In addition, the IRS provided for an automatic extension from the date the statements were required to be filed with the IRS. These extensions will not apply to the extended due dates.
Even though most employees will not be affected by the extensions, an employee who did not receive a determination from the Marketplace that the offer of employer-sponsored coverage was not affordable may be affected by the extension if they do not receive a Form 1095-C before filing an individual tax return. For 2015 only, any such 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 2015 only, 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 the Form 1095-B or 1095-C.
These extensions will be welcome to many employers who are working towards compliance with these requirements for 2015 coverage and may be contemplating filing one or more extension requests with the IRS. Since the extensions provided by this new guidance are more generous than the extensions permitted previously, no action is required to take advantage of these new extensions.