Deadlines for Affordable Care Act (ACA) reporting for the 2024 tax year are swiftly approaching. The IRS has released final forms and instructions for 1094-B and 1095-B. As a reminder, Forms 1094-B and 1095-B are filed by minimum essential coverage providers (such as health insurers and employers sponsoring self-insured health plans) to report coverage information in accordance with Code § 6055. The forms are essentially unchanged from 2023; however, the B form instructions clarify that information reporting penalties for failure to file correct information returns are lower if applicable to small businesses with average gross receipts of $5 million or less. Additionally, the form instructions now include reference to the fact that the penalty per return increases to $660 with no annual maximum limitation if there is an intentional disregard of the requirements to file the returns and furnish recipient statements. To view the full instructions and forms provided by the IRS, click the links below:
In preparation for form filings, here are a few things you should note:
Who Is Required to Report?
1094-B and 1095-B: These forms are used by health insurers and employers sponsoring self-insured health plans (regardless of size, except for large self-insuring employers) to report coverage information in accordance with Code § 6055 of the Internal Revenue Code and as mandated by the Affordable Care Act. Note: Self-insuring employers with less than 50 full-time or full-time equivalent employees will use these forms to report information on coverage to the IRS and to covered individuals.
What Are the Deadlines?
The deadlines are as follows:
Deadline for Furnishing Statements to Individuals
-
The deadline for furnishing Forms 1095-B to individuals is March 3, 2025.
Deadline for Filing Returns With the IRS
- For paper filings: February 28, 2025
Only employers submitting nine or fewer forms in the aggregate are allowed to file their Forms 1094-B and 1095-B by paper. -
For electronic filings: March 31, 2025
Employers submitting 10 or more returns in the aggregate must file their Forms 1094-B and 1095-B electronically.
Filers may extend these deadlines by application to the IRS using Form 8809.
What Are the Requirements for Small Employers?
As for Small Employers, the ACA requires self-funded employers to satisfy two reporting obligations under Sections 6055 and 6056 of the Internal Revenue Code. The reporting relates to health coverage offered to employees, and about those employees who are covered under the plan. Smaller employers with fewer than 50 full-time equivalent employees are only required to meet one of those obligations, the Minimum Essential Coverage reporting under Section 6055.
Section 6055 Reporting Compliance
Under Code § 6055 of the Internal Revenue Code, all self-funded employers must annually report information to the IRS and to any employees who are covered under a health plan offered by the employer. The following data must be reported to the IRS:
-
The name and address of each covered employee;
-
The tax ID (social security number) for each covered individual (including dependents);
-
The months that each covered individual was covered under the plan; and
-
The employer’s name, address, and tax ID number.
This same information must be reported to employees, along with basic contact information for the employer. The IRS has created Forms 1094-B and 1095-B (the “B Forms”) for purposes of allowing small employers to meet this requirement.
Currently, many employers do not have access to the social security numbers (SSNs) for non-employed dependents, creating a fairly significant compliance burden to collect that data. The regulations require that employers exercise “reasonable collection efforts” to obtain that information. (Typically, an employer will satisfy that standard by documenting at least two efforts to request the data from those individuals.)
How Will MedCost Assist Clients?
MedCost is generating reports for our clients that will be available as early as the week of December 16, 2024. Reports will be posted to the secure Employers portal of our website. Details on how to use the reports and the report contents will be discussed in a future communication.
For small employers, this report will contain nearly all of the information needed to complete the necessary forms. In addition to providing this report, MedCost is offering form preparation services for a small fee to our small employer clients. Through this service, MedCost will prepare the B Forms for your covered employees and the IRS, and securely transmit an electronic version of the Forms for review by February 2025 to the person you identify as the primary benefits (HR) contact. The fee for this service is $500, which will be billed at the time the draft forms are provided to you. If you are interested in having MedCost provide form preparation services, you must submit the completed Request Form to [email protected] by December 31, 2024.
Note: This service will not include filing or delivery of any forms to the IRS or to individuals. Additional information is included on the Request Form.
Questions?
Please contact your Account Manager or the Compliance Department at [email protected] for more information.