Close
Close

IRS releases final forms and instructions for reporting information under the ACA

RFP
Tax Hot Topics
Tax Hot TopicsThe IRS recently released final forms that employers must use to report health coverage that they offer to their employees. These new reporting requirements, which become effective for the 2015 calendar year, were added by the Affordable Care Act (ACA). These requirements are in addition to the requirement already in effect to report the cost of health insurance on Form W-2. Read more about the reporting requirements.

Applicable large employers (with 50 or more full-time and full-time equivalent employees (FTEs) will use Form 1094-C Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, to satisfy reporting requirements under Sections 6055 and 6056. Health insurance companies will use Form 1094-B, Transmittal of Health Coverage Information Returns, and Form 1095-B, Health Coverage, to satisfy the Section 6055 reporting requirements.

The forms are nearly identical to the draft forms issued by the IRS in August 2014, but additional guidance was added to the instructions. Highlights of the instruction changes include the following:
  • Employers with 50–99 FTEs who are exempt from the employer shared responsibility penalties in 2015 are still required to file these forms for 2015.
  • Some employer plans do not offer coverage to an employee’s spouse if the spouse is covered or offered coverage through the spouse’s employer. The final instructions provide that an offer to a spouse that is subject to a reasonable, objective condition is treated as an offer of coverage for reporting purposes.
  • Employers that cover non-employees (e.g., COBRA beneficiaries and retirees) may use Forms 1094-B and 1095-B instead of filling out Part II of Form 1095-C to report information for those individuals.
  • Applicable large employers are required to report their total number of employees. The draft instructions provided that the employer may count the number of employees as of the first or last day of the calendar month. The final instructions add a method for counting employees — the first or last day of the first payroll period starting in the calendar month.
  • Applicable large employers may be members of a consolidated group. If an employee works for more than one member of the consolidated group, the employee is treated as the employee only of the applicable large employer member for which the employee has the greatest number of hours worked for the month. Only the applicable large employer member treated as the employer for the month reports on Form 1095-C information for that employee for the month.
 
Contacts
Eddie Adkins
T +1 202 521 1565
E eddie.adkins@us.gt.com

Jeffrey Martin
T +1 202 521 1526
E jeffrey.martin@us.gt.com

Tax professional standards statement
This document supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the subject of this document, we encourage you to contact us or an independent tax adviser to discuss the potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this document may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this document is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.

The information contained herein is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, the reader’s specific circumstances or needs and may require consideration of tax and nontax factors not described herein. Contact Grant Thornton LLP or other tax professionals prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis, the information contained herein; Grant Thornton LLP assumes no obligation to inform the reader of any such changes. All references to “Section,” “Sec.,” or “§” refer to the Internal Revenue Code of 1986, as amended.