Employer ACA Reporting – Final 2017 Forms
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The Internal Revenue Service (IRS) has released final 2017 forms and instructions for reporting under Internal Revenue Code (Code) Sections 6055 and 6056.
- 2017 Forms 1094-C and 1095-C (and related instructions) are used by applicable large employers (ALEs) to report under Section 6056, as well as for combined Section 6055 and 6056 reporting by ALEs who sponsor self-insured plans.
The 2017 forms are substantially similar to the 2016 versions, except that sections related to expired Section 4980H Transition Relief were removed.
January 31, 2018
- Individual statements for 2017 must be furnished to employees by Jan. 31, 2018.
February 28, 2018
- IRS returns for 2017 must be filed with the IRS by Feb. 28, 2018 (April 2, 2018, if filed electronically, since March 31, 2018, is a Saturday).
The Affordable Care Act (ACA) created reporting requirements under Code Sections 6055 and 6056. Under these rules, certain employers must provide information to the IRS about the health plan coverage they offer (or do not offer) or provide to their employees. Each reporting entity must annually file all of the following with the IRS:
- A separate statement (Form 1095-C) for each individual who is provided with minimum essential coverage (for self-insured ALEs reporting under Section 6055), or for each full-time employee (for ALEs reporting under Section 6056); and
- A transmittal form (Form 1094-C) for all of the returns filed for a given calendar year.
- Reporting entities must also furnish related statements (Form 1095-C) to individuals.
Forms must generally be filed with the IRS no later than Feb. 28 (March 31, if filed electronically) of the year following the calendar year to which the return relates. Individual statements must be furnished to individuals on or before Jan. 31 of the year immediately following the calendar year to which the statements relate.
2017 Forms and Instructions
The 2017 forms and instructions are substantially similar to the 2016 versions. However, note the following changes:
- Section 4980H Transition Relief. Several forms of transition relief were available to some employers under Section 4980H for the 2015 plan year (including any portion of the 2015 plan year that fell in 2016). However, no Section 4980H transition relief is available for 2017. As a result, the 2017 instructions for Forms 1094-C and 1095-C were revised to remove references to Section 4980H transition relief. In addition, Form 1094-C has been revised to remove references to this transition relief. Specifically, the following two sections on Form 1094-C related to this transition relief have been designated as “Reserved” and should not be used: Part II, in the “Certifications of Eligibility” Section on Line 22, Box C; and Part III, in the “ALE Member Information – Monthly” table, column (e).
- Instructions for Recipient. Form 1095-C includes an “Instructions for Recipient” section. On the 2017 Forms 1095-C, the following paragraph was added: “Additional information. For additional information about the tax provisions of the Affordable Care Act (ACA), including the individual shared responsibility provisions, the premium tax credit, and the employer shared responsibility provisions, see www.irs.gov/Affordable-Care-Act/Individuals-and-Families or call the IRS Healthcare Hotline for ACA questions (1-800-919-0452).”
- Updated Penalty Amounts. The 2017 instructions include updated penalty amounts for failures to file returns and furnish statements in 2017. The adjusted penalty amount is $260 per violation, with an annual maximum of $3,218,500 (up from a maximum of $3,193,000, for 2016).
- Code Series 2 (Section 4980H Safe Harbor Codes and Other Relief). The 2017 instructions for Forms 1094-C and 1095-C clarify that there is no specific code to enter on line 16 to indicate that a full-time employee who was offered coverage either did not enroll or waived the coverage.
- Corrected Forms 1095-C. The 2017 instructions for Forms 1094-C and 1095-C include additional information for employers that have errors on Forms 1095-C. Specifically, the instructions indicate that Forms 1095-C filed with incorrect dollar amounts on line 15, Employee Required Contribution, may fall under a safe harbor for certain de minimis The safe harbor generally applies if no single amount in error differs from the correct amount by more than $100. If the safe harbor applies, employers will not have to correct Form 1095-C to avoid penalties. However, if the recipient elects for the safe harbor not to apply, the employer may have to issue a corrected Form 1095-C to avoid penalties. For more information, see Notice 2017-9.
- Formatting Returns Filed with the IRS. The 2017 instructions clarify that all returns filed with the IRS must be printed in landscape format.
In addition, a prior draft version of Form 1095-C for 2017 clarified that the “Plan Start Month” box in Part II of Form 1095-C will remain optional for 2017. The instructions for Forms 1094-C and 1095-C indicate that this box may be mandatory for the 2018 Form 1095-C.
The IRS also previously released:
- Q&As on Section 6055 and Q&As on Section 6056; and
- A separate set of Q&As on Employer Reporting using Form 1094-C and Form 1095-C.
Please contact Lawley for more information on reporting under Code Sections 6055 and 6056.
Judy Kamens Compliance Specialist
Judy joined the Employee Benefits division of Lawley in March 2010 as a compliance specialist. Judy’s role is to provide clients with enhanced service in the areas of new and existing legislation and compliance. She works closely with employee benefits consultants and account executives to provide clients with the tools and information to remain compliant. Judy provides timely education and guidance and conveys the requirements and intricacies of new legislation in a practical fashion. Specifically, Judy has focused her attention on the Affordable Care Act (ACA) and possesses a thorough understanding of the continuously evolving requirements of this law.View Bio LinkedIn
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