Before we talk about reporting deadlines, let’s first discuss who actually needs to report that health care coverage information? Since the Affordable Care Act was signed into law, business owners must keep a close eye on how many employees they have on payroll. Because a company with an average of fifty or more full-time employees or equivalents during the previous year is considered an applicable large employer (ALE) for the current calendar year. And being an ALE carries additional responsibilities under the law.

Health care coverage information

First and foremost, ALEs are subject to Internal Revenue Code Section 4980H — more commonly known as “employer shared responsibility.” That is, if an ALE doesn’t offer minimum essential health care coverage that’s affordable and provides at least “minimum value” to its full-time employees and their dependents, the employer may be subject to a penalty.

However, the penalty is only triggered if at least one of the full-time employees receives a premium tax credit when individual coverage is bought through a Health Insurance Marketplace. You may have heard the Health Insurance Marketplace commonly referred to as an “exchange.”

ALEs must do something else as well. They need to report:

• Whether they offered full-time employees and their dependents the opportunity to enroll in minimum essential coverage under an eligible employer-sponsored plan
• Whether the offered coverage was affordable and provided at least minimum value
• Certain other information the IRS uses to administer employer shared responsibility

The IRS has designated Forms 1094-C and 1095-C to satisfy these reporting requirements. Each full-time employee, and each enrolled part-time employee, must receive a Form 1095-C. Form 1094-C is a transmittal to file Forms 1095-C with the IRS.

3 key deadlines for reporting health care coverage

If your business was indeed an ALE for 2021, here are three key deadlines to put on your calendar:

1. February 28, 2022. This is the IRS deadline for the paper filing of the Form 1094-C transmittal. This also includes copies of related Forms 1095-C.
2. March 2, 2022. This is the deadline for furnishing the written statement, Form 1095-C, to full-time employees and to enrolled part-time employees. Although the statutory deadline is January 31, the IRS has issued proposed regulations with a blanket 30-day extension. ALEs can rely on the proposed regulations for the 2021 tax year (in other words, forms due in 2022). In previous years, the IRS adopted a similar extension year by year. The extension is permanent if the regulations are finalized. No other extensions are available for this deadline.
3. March 31, 2022. This is the IRS deadline for the electronic filing of the Form 1094-C transmittal. Again, this also includes copies of related Forms 1095-C. Electronic filing is mandatory for ALEs filing 250 or more Forms 1095-C for the 2021 calendar year.

Whether you’re a paper or electronic filer, you can apply for an automatic 30-day extension of the deadlines to file with the IRS. However, the extension is available only if you file Form 8809, “Application for Extension of Time to File Information Returns,” before the applicable due date.

Alternative method

Suppose your company offers a self-insured health care plan. In that case, an alternative method of furnishing Form 1095-C may be interesting. This method applies to enrolled employees who weren’t full-time for any month in 2021.

Rather than automatically furnishing the written statement to those employees, you can make the statement available to them by posting a conspicuous plain-English notice on your website that’s reasonably accessible to everyone. The notice must state that they may receive a copy of their statement upon request. It needs to also include:

• An email address for requests
• A physical address for statement requests
• A contact telephone number for questions

In addition, the notice must be written in a large font size. It must be large enough to highlight that the information pertains to tax statements reporting that individuals had health care coverage. This includes any visual clues or graphical figures. You need to retain the notice in the same location on your website through October 17, 2022. If someone requests a statement, you must fulfill the request within 30 days of receiving it.

Identify your obligations

Although the term “applicable large employer” might seem to apply only to big companies, even a relatively small business with far fewer than 100 employees could be subject to the employer shared responsibility and information reporting rules. We can help you identify your obligations under the Affordable Care Act and assess the costs associated with the health care coverage that you offer. Contact our RRBB accountants and advisorstoday.

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