On September 9, 2013, the IRS released two new sets of proposed regulations covering plan sponsor, insurer and large employer reporting requirements designed to implement key provisions of the Affordable Care Act (“ACA”). The first set of proposed regulations would implement Internal Revenue Code (“Code”) Section 6055, which generally requires that health insurers and plan sponsors of self-insured coverage report certain information to the IRS and enrollees. The second set of proposed regulations would implement Code Section 6056, which requires large employers to report to the IRS and to their “full-time” employees as defined under Code Section 4980H (generally, those averaging at least 30 hours per week ) certain information about the health coverage offered to such employees. Notice 2013-45 previously provided transition relief for Section 6055 and 6056 reporting for 2014, stating that reporting for the 2014 calendar year would be voluntary, and that transition rule remains in effect. The IRS has stated that it is continuing to examine ways to streamline and combine reporting under these sections, including the possible use of Form W-2, and is soliciting comments on the issue.
Code Section 6055 Reporting by Health Insurers and Sponsors of Self-Funded Plans. The information reported to the IRS and enrollees under Code Section 6055 and these proposed regulations will allow individuals to establish, and the IRS to verify, that the individuals were covered by minimum essential coverage and their months of such coverage during the year. This is critical to administration of the individual mandate under Code § 5000A, as well as premium tax credits under Code § 36B. Specifically, the proposed regulations under Code Section 6055 require providers of minimum essential coverage to report to the IRS, among other things, the name, address and taxpayer identification number (“TIN”)1 for each individual covered during the year and the months for which the individual was enrolled in coverage on at least one day. The information must be filed on IRS Form 1095-B or such other forms or substitute forms as the IRS may designate, and must be filed by February 28 (March 31 if filed electronically) of the year following the calendar year to which they relate. The proposed regulations also require that the reporting entity furnish a statement to the covered individual containing the name, address and contact number of the reporting entity and the same information required to be reported to the IRS. The statements to individuals must be furnished by January 31 of the year following the calendar year to which they relate. Notably, the reporting entity with respect to self-insured coverage offered through a multiemployer plan is the Board of Trustees.
Code Section 6056 Reporting by Employers with More than 50 Employees. The information reported to the IRS and employees under Code Section 6056 and the proposed regulations will assist with the administration of the premium tax credit described in Code Section 36B and the employer shared responsibility provisions contained in Section 4980H. The proposed regulations describe in detail the content and timing of information to be reported by large employers to the IRS and their employees. These items include (1) a certification as to whether the employer offered its full-time employees and their dependents the opportunity to enroll in minimum essential coverage, by calendar month; (2) the number of full-time employees for each month in the calendar year; (3) for each full-time employee, the months for which coverage was made available; (4) for each full-time employee, the employee’s share of the lowest cost monthly premium (self-only) for coverage providing minimum value, by calendar month; and (5) the name, address and TIN for each full-time employee and the months, if any, for which the employee was covered under an employer-sponsored plan. The information must be filed on Form 1095-C or such other forms or substitute forms as the IRS may designate, and must be filed by February 28 (March 31 if filed electronically) of the year immediately following the calendar year to which the return relates. The employer must also furnish a statement to each full-time employee containing the information provided to the IRS with respect that employee. The employee statement must be provided by January 31 of the year immediately following the calendar year to which the employee statement relates. For employers contributing to multiemployer health plans, the rules allow the multiemployer plan to fulfill the employer reporting requirements with respect to any contributing employer’s employees covered by the multiemployer plan. The contributing employer would still have to report on employees not covered by the multiemployer plan.
The proposed regulations can be found here:
Section 6055. FR-2013-21783.
Section 6056. FR-2013-21791
Not Intended As Legal Advice.