You are here

Compliance Alert - 2016 ACA Reporting Deadline Extended by 30 Days

On Friday, the IRS issued IRS Notice 2016-70, extending the deadline for providing the 2016 Forms 1095-B and 1095-C to individuals by 30 days. 

As a reminder, applicable large employers (ALEs) provide the Form 1095-C to individuals. If the plan is fully insured, the insurance carrier also provides the Form 1095-B to covered individuals (in addition to the Form 1095-C provided by the ALE).  If the plan is self-insured, all of the ACA reporting information is included in the Form 1095-C (i.e., such individuals will not receive a Form 1095-B).  Non-ALEs sponsoring a self-insured plan must provide covered individuals with the Form 1095-B (not the Form 1095-C).

The IRS states the reason for the extension is because they “have determined that a substantial number of employers, insurers, and other providers of minimum essential coverage need additional time beyond the January 31, 2017, due date to gather and analyze the information and prepare the 2016 Forms 1095-B and 1095-C to be furnished to individuals.”

There was no extension to the standard deadline to file the Forms 1094-B and 1094-C (and copies of the Forms 1095-B and 1095-C) with the IRS because they found “no similar need.”

The 2016 ACA reporting deadlines are now as follows:

2016 Forms 1095-B and 1095-C: Deadline to Furnish to Individuals

Standard Due Date: January 31, 2017

Extended Due Date: March 2, 2017

2016 Forms 1094-B and 1094-C (+Copies of Forms 1095-B/1095-C):

Deadline to File with IRS by Paper

Standard Due Date: February 28, 2017

2016 Forms 1094-B and 1094-C (+Copies of Forms 1095-B/1095-C):

Deadline to File with IRS Electronically (Required for 250 or More Returns)

Standard Due Date: March 31, 2017

No Need to Wait for Form to File Individual Tax Return

The information on the Forms 1095-B and 1095-C shows compliance with the ACA’s individual shared responsibility provisions (the individual mandate) by confirming that individuals maintained minimum essential coverage. The information is also relevant for certain individuals who claimed advance payment of the premium tax credit for coverage on the exchange (Marketplace). 

The IRS states in the Notice that individuals may file their individual tax return (Form 1040) prior to receiving the Forms 1095-B and/or 1095-C by relying on any other information received from the employer or coverage provider (e.g., insurance carrier).

Good Faith Standard Also Extended

The IRS also announced that it is extending the good faith enforcement safe harbor from penalties (generally $260 per return) for incorrect or incomplete information on the ACA reporting forms.  This includes missing and inaccurate SSNs and DOBs.

To take advantage of the extended transition relief, employers must make a good faith effort to comply and provide and distribute the forms by the deadlines set out above.  So as with last year, completing the ACA reporting by the applicable deadlines takes on extra significance.

Future Years

Nothing in the Notice extends the deadlines or good faith standard beyond the 2016 ACA reporting forms.  However, as discussed in our alert following President Elect Trump’s election, it is very likely that this will be the last year employers and coverage providers will be subject to the ACA reporting requirements.

Disclaimer: The intent of this analysis is to provide the recipient with general information regarding the status of, and/or potential concerns related to, the recipient’s current employee benefits issues. This analysis does not necessarily fully address the recipient’s specific issue, and it should not be construed as, nor is it intended to provide, legal advice. Furthermore, this message does not establish an attorney-client relationship.  Questions regarding specific issues should be addressed to the person(s) who provide legal advice to the recipient regarding employee benefits issues (e.g., the recipient’s general counsel or an attorney hired by the recipient who specializes in employee benefits law).

Connect with Us