The IRS is once again giving insurers and self-insured employer health plans 30 extra days to get Form 1095-B and Form 1095-C coverage notices to the enrollees, former enrollees, and other people who are supposed to receive the forms.
The IRS announced the information reporting deadlines for the 2017 coverage year in IRS Notice 2018-06. About a year ago, IRS set similar notice deadlines for coverage reporting for the 2016 coverage year. Consumers use 1095 forms to show whether they qualify for the Affordable Care Act premium tax credit and the ACA cost-sharing reduction subsidy, and to show whether they have to pay the ACA individual mandate penalty.
Originally, insurers and employer plans were supposed to get the 1095 notices for 2017 coverage to enrollees and former enrollees by Jan. 31, 2018. Coverage providers now have until March 2, 2018, to send the notices to the recipients. Employers and insurers also have to send copies of the 1095 forms, along with 1094 summary forms, to the IRS.
The IRS is sticking to the official schedule for the IRS filing deadlines. For organizations that file their returns on paper, 1095 form bundles for 2017 coverage will be due Feb. 28, 2018. For organizations that use the electronic filing system, the 1095 bundles will be due April 2, 2018.
An employer or insurer that needs more time to file its 1095 bundle can ask for an automatic deadline extension by filing Form 8809 with the IRS.
The ACA, and the individual mandate, are still here
The Affordable Care Act imposes a penalty on many families that fail to have enough of what the government classifies as minimum essential coverage, or solid major medical coverage, for enough of the year.
Consumers use 1095 forms to document whether they did enough to keep themselves covered to avoid the ACA individual mandate penalty.
The new federal Tax Cuts and Jobs Act will set the individual mandate penalty at zero, but TCJA Section 11081 applies only for months beginning after Dec. 31, 2018. For 2018, the individual mandate penalty will still be equal to 2.5% of modified adjusted gross income over the tax filing threshold. That means individual taxpayers will still need 1095s when they file their income taxes for 2017 early in 2018. The TCJA leaves all of the rest of the ACA, including the employer and insurer coverage reporting requirements, in place.
The IRS now requires employers and employer-sponsored health plans to get detailed information about plan members’ dependents for the 1095 forms. Employers need the dependents’ full names, dates of birth, and Social Security numbers.
Last year, the IRS provided transition relief for employers and insurers that were unable to supply correct, complete information, if they could show they made good-faith efforts to comply with the reporting requirements.
The IRS says it will keep the good-faith relief in place for the 2017 coverage year.
“No relief is provided in the case of reporting entities that do not make a good-faith effort to comply with the regulations or that fail to file an information return or furnish a statement by the due date,” officials say in the new notice.