What You Need To Know About The 2020 ACA Instructions
Nov 10, 2020
What You Need To Know About The 2020 ACA Instructions
1094-C And 1095-C
Future Developments
For the latest information about developments related to 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, and instructions, such as legislation enacted after they were published, go to IRS.gov/Form1094C and IRS.gov/Form1095C.
What’s New
Extension of due date for furnishing statements
The due date for furnishing Form 1095-C to individuals is extended from January 31, 2021, to March 2, 2021.
Relief for failure to furnish statements to certain employees enrolled in self-insured health plan
The IRS will not impose a penalty for failure to furnish Form 1095-C to any employee enrolled in an ALE member’s self-insured health plan who is not a full-time employee for any month of 2020 if certain conditions are met. • No penalty will be imposed for reporting incorrect or incomplete information on the return or statement if the ALE Member can show that it made good-faith efforts to comply with the information reporting requirements.
Individual coverage health reimbursement arrangement (HRA)
For plan years beginning on or after January 1, 2020, employers may offer HRAs integrated with individual health insurance coverage or Medicare, subject to certain conditions (individual coverage HRAs). On September 30, 2019, the IRS and the Department of the Treasury issued proposed regulations clarifying the application of the employer shared responsibility provisions in section 4980H to individual coverage HRAs and providing proposed safe harbors for the application of those provisions to individual coverage HRAs.
Form 1095-C has been modified to add new codes for reporting offers of individual coverage HRAs and new lines for reporting required information.
If the employee was offered an individual coverage HRA, enter the employee’s age on January 1, 2020. Note that for non-calendar year plans or for employees who become eligible during the plan year, this age may not be the Applicable age used to determine Employee Required Contribution.
If the ALE Member used code 1L, 1M, 1N, 1O, 1P, or 1Q because it offered the employee an individual coverage HRA, enter the appropriate ZIP code used for identifying the lowest cost silver plan used to calculate the Employee Required Contribution in line 15. This will be the ZIP code of the employee’s residence (code 1L, 1M, or 1N) or the ZIP code of the employee’s primary site of employment if the ALE Member uses the work location safe harbor (code 1O, 1P, or 1Q).
Plan start month
This is required for the 2020 Form 1095-C. The Applicable Large Employer (ALE) must enter a two-digit number.
1094-B and 1095-B
Future Developments
For the latest information about developments relating to IRS Forms 1094-B, Transmittal of Health Coverage Information Returns, and 1095-B, Health Coverage, and the instructions, such as legislation enacted after they were published, go to IRS.gov/Form1094B and IRS.gov/Form1095B.
What’s New
Individual coverage health reimbursement arrangement (HRA). For plan years beginning on or after January 1, 2020, employers may offer HRAs integrated with individual health insurance coverage or Medicare, subject to certain conditions (individual coverage HRAs).
Generally, an HRA, including an individual coverage HRA, is a self-insured group health plan and, therefore, is an eligible employer-sponsored plan.
If the employee was offered an individual coverage HRA, enter the employee’s age on January 1, 2020. Note that for non-calendar year plans or for employees who become eligible during the plan year, this age may not be the Applicable age used to determine Employee Required Contribution.
If the ALE Member used code 1L, 1M, 1N, 1O, 1P, or 1Q because it offered the employee an individual coverage HRA, enter the appropriate ZIP code used for identifying the lowest cost silver plan used to calculate the Employee Required Contribution in line 15. This will be the ZIP code of the employee’s residence (code 1L, 1M, or 1N) or the ZIP code of the employee’s primary site of employment if the ALE Member uses the work location safe harbor (code 1O, 1P, or 1Q).
New type of coverage code
A new code G must be entered on Form 1095-B, line 8 to identify an individual coverage HRA.
Extension of due date for furnishing statements
The due date for furnishing Form 1095-B to individuals is extended from January 31, 2021, to March 2, 2021.
Relief for failure to furnish statements
The IRS will not impose a penalty for failure to furnish Form 1095-B to individuals if certain conditions are met. The penalties may be waived if the failure was due to reasonable cause and not willful neglect.
Additional Information
For information relating to the Affordable Care Act, visit IRS.gov/ACA.
For additional information see the instructions regarding legal requirements and filing of 1094-B/1095-B.