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IRS extends deadlines for ACA information reporting

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Under the Affordable Care Act (ACA), certain employers must report health care plan information to the IRS and employees. Specifically, Forms 1094/1095-B (B Forms) and Forms 1094/1095-C (C Forms) may need to be submitted for the 2017 tax year. The agency recently extended submission deadlines for these forms under some circumstances. Let’s delve into the details.

Background

The B Forms are filed by minimum essential coverage providers — mostly insurers and government-sponsored programs, but also some self-insuring employers and others. The C Forms are filed by applicable large employers (ALEs — generally, employers that employed 50 or more full-time employees or the equivalent during the previous year) to provide information the IRS needs to administer the ACA’s employer shared responsibility and premium tax credit provisions. ALEs with self-insured health plans also report coverage information on Form 1095-C. Forms 1095-B and 1095-C must also be furnished to employees.

General extension

The IRS recently issued Notice 2018-06 to announce limited relief for information reporting on Forms 1094 and 1095 for the 2017 tax year. The deadline for furnishing Forms 1095-B and 1095-C to employees has been extended by 30 days, from January 31 to March 2, 2018. Because of this automatic extension, the discretionary 30-day extension isn’t available, and no further extensions may be obtained.

The notice doesn’t, however, extend the due date for filing Forms 1094-B and 1094-C (and accompanying Forms 1095) with the IRS. Accordingly, the deadlines remain February 28, 2018, for paper filings and April 2, 2018, for electronic filings. (Electronic filing is mandatory for employers required to file 250 or more Forms 1095.) However, filers may obtain an automatic 30-day extension by filing Form 8809 on or before the regular due date.

Good faith relief

Also, the IRS will again provide penalty relief for employers that can show they have made good faith efforts at compliance. No penalties will be imposed on employers that report incorrect or incomplete information — either on statements furnished to employees or returns filed with the IRS — if they can show they made good faith efforts to comply with the reporting requirements.

The notice specifies that the relief applies to missing and inaccurate taxpayer identification numbers and dates of birth, as well as other required information. Penalty relief isn’t available to employers that:

  • Fail to furnish statements or file returns,
  • Miss an applicable deadline, or
  • Otherwise don’t make good faith efforts to comply.

Evidence of good faith efforts may include gathering necessary data and transmitting it to a third party to prepare the required reports, testing the ability to transmit data to the IRS, and taking steps to ensure compliance for the 2018 tax year.

Total compliance

If your organization self-insures or is defined as an ALE for the 2017 tax year, make sure you’re in total compliance with the ACA’s information reporting requirements. Our firm can help you with the pertinent details.

Senate Republicans release health care reform “discussion draft.”

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The Better Care Reconciliation Act of 2017 (BCRA) summarizes their plan for repealing and replacing the Affordable Care Act (ACA). The BCRA would, among other things, eliminate many of the ACA taxes but retain the ACA premium tax credits in modified form. The Congressional Budget Office will now score the BCRA, which will include cost estimates and an estimate of how many individuals will likely lose coverage if the plan is passed as is. The Senate expects to vote on the bill before July 4.

CBO grades American Health Care Act

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The Congressional Budget Office (CBO) gives its “score” to the American Health Care Act (AHCA). The CBO issued a report projecting the proposed law would reduce federal deficits by $337 billion from 2017-2026. The largest savings would come from reduced Medicaid outlays and eliminating the Affordable Care Act (ACA) subsidies for nongroup health insurance. Savings would be offset by a new tax credit and repealing many ACA taxes and penalties. In 2018, the CBO estimated 14 million more people would be uninsured under the bill, increasing to 24 million in 2026.

A March madness score that doesn’t involve college basketball.

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This week, the Congressional Budget Office (CBO) is expected to “score” the proposed bill that U.S. House representatives have released to replace the Affordable Care Act. The CBO score will calculate the cost of the American Health Care Act, as well as how many Americans would lose health coverage under it. According to its website, each year the CBO “provides the Congress with several hundred formal cost estimates that analyze the likely effects of proposed legislation on the federal budget.”