As the fifth anniversary of its enactment fast approaches, employers continue to confront significant challenges in determining and meeting their obligations under the Patient Protection and Affordable Care Act of 2010, as amended ("PPACA"). This is unsurprising given the fact that many obligations continue to evolve, as evidenced by the forms and accompanying instructions for reporting certain health coverage information for the 2014 taxable year finalized by the IRS in February 2015 (collectively, the "2014 Forms"). While reporting for the 2014 taxable year is purely voluntary, this client alert highlights for employers the broader relevance of the 2014 Forms.
The 2014 Forms consist of two sets of forms and accompanying instructions. As discussed in our September 2014 client alert "IRS Issues Draft Instructions for Reporting Health Coverage Information", the "B-Series" Forms are to be used by non-ALE employers providing MEC by means of a self-insured group health plan. The "C-Series" Forms are to be used by ALEs. Each series consists of a transmittal form to be provided to the IRS (Form 1094-B or 1094-C, as applicable) and an information return to be provided to individual taxpayers (Form 1095-B or 1095-C, as applicable). The IRS has also issued Publication 5196 which provides an overview of the ALE reporting requirement (i.e., the C-Series Forms).
As noted above, completing the 2014 Forms is purely voluntary and thus an individual decision each employer must make. Employers may choose to (1) prepare 2014 Forms but not submit them to the IRS, (2) prepare 2014 Forms and submit them to the IRS, or (3) not prepare 2014 Forms at all. Even employers who choose not to prepare 2014 Forms at all, however, may find it useful to review the 2014 Forms early in 2015. While the forms and instructions for the 2015 taxable year (collectively, the "2015 Forms") may include revisions to the 2014 Forms, the 2014 Forms can nonetheless help employers determine the information they should collect in 2015 in order to properly complete the 2015 Forms.
The 2014 Forms contain important revisions to the previously issued drafts. Inter alia, such revisions include (1) simplified reporting for certain ALEs with non-employees enrolled in their self-insured group health plans, (2) new options for ALEs when counting their total number of employees, and (3) clarification of certain rules applicable to "authoritative transmittals". The available and preferred options for satisfying the applicable information reporting requirements will depend on an employer's specific facts.