IRS Extends Deadline to Supply ACA Forms to Employees
REDW | January 3, 2018
In IRS Notice 2018-06, the IRS announced an automatic 30-day extension of the 2018 due date for furnishing 2017 Forms 1095-B (Health Coverage) and 1095-C (Employer-Provided Health Insurance Offer and Coverage). Employers now have until March 2, 2018 to distribute 2017 health coverage information forms to employees.
Employees may use this information to determine whether they may claim the premium tax credit on their income tax returns. However, they can prepare and file returns using other information about health coverage received from their employer—such as their W-2 form—to show they had ACA-compliant health coverage during the year. If employers take advantage of the extension and receive employee requests for 2017 Forms 1095-C before the extended due date, they should refer their employees to the guidance in Notice 2018-06.
“Because of these extensions, individuals may not receive their Forms 1095-B or 1095-C by the time they are ready to file their 2017 individual income tax return,” the IRS said in a news release. “While information on these forms may assist in preparing a return, the forms are not required to file.”
Despite the extended deadline, the IRS is encouraging employers to furnish these forms to employees as soon as they are able.
IRS filing deadlines not extended
The Notice does not extend the due date for employers, insurers, and other providers of minimum coverage to file 2017 Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS. The filing due date for these forms remains February 28, 2018 (April 2, 2018, if filing electronically), unless the due dates are extended pursuant to other available relief.
The IRS also said it will not impose penalties on employers that can show they made good-faith efforts to comply with the Affordable Care Act’s (ACA’s) information-reporting requirements for plan year 2017.
Employers filing at least 250 Forms 1095-C with the IRS must do so electronically unless they obtain a waiver from the IRS. Employers may obtain a 30-day extension for filing with the IRS by submitting Form 8809 on or before those deadlines.
Good-faith exemption extended
Notice 2018-06 also extends good-faith transition relief. As in previous years, employers will be able to use the good-faith efforts standard to protect themselves from filing information returns or payee statements with inaccurate or incorrect information. This relief applies only to incorrect and incomplete information reported on Form 1095-C or 1095-B, and not to a failure to timely furnish or file the forms.
The IRS says that it does not anticipate extending this transition relief – either with respect to the due dates or with respect to good faith relief from penalties – to reporting for 2018. This statement highlights the fact that, although the individual mandate penalty is repealed as of 2019, the reporting requirements that support it, as well as the employer mandate, remain in effect.
For more information on this important development or on ACA-related issues influencing employers, please contact Alicia Finley at AFinley@redw.com.
For a view of IRS Notice 2018-06, visit irs.gov/newsroom.