Beginning with tax year 2015, employers will be required to file Form 1095-B or 1095-C for all applicable employees as part of their IRS reporting requirements under the Affordable Care Act. The filing requirements are based on the health plan offered and the number of employees. Small employers are those with fewer than 50 full time employees or equivalents; large employers have over 50. Anyone who works on average 30 or more hours per week is considered full time.
As a basic rule, Form 1095-B (Health Coverage) and Form 1094-B (Transmittal of Health Coverage Information Returns) are to be filed by insurance companies to report those covered by insured employer-sponsored group health plans, or by small employers with self-insured health plans. Only employees who accept coverage are reported, not any who are offered coverage but decline.
Form 1095-C (Employer-Provided Health Insurance Offer and Coverage) and Form 1094-C (Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns) are to be used by large employers, whether they offer an insured or self-insured plan or do not offer group health insurance.
One important note: Companies that are considered members of an Applicable Large Employer Group (ALEG) will be required to file Forms 1095-C and 1094-C according to the rules for large employers. A company is considered part of an ALEG if it is a member of a controlled or affiliated group that has at least 50 FTEs as a collective total. Companies that have owners in common, provide services for each other or work together to provide services to third parties may be considered member of an ALEG.
Here is a quick review of who needs to file what forms by the numbers:
*If non-employees such as directors, retirees and individuals on COBRA are enrolled in self-insured health plans, companies may report these non-employees on Forms 1095-B and 1094-B instead of Forms 1095-C and 1094-C.
Understanding what needs to be reported can be complex. If you have any questions, Deluxe Payroll is here to help – firstname.lastname@example.org or 443.279.9000 x1212.