IRS Notice 2019-63 (Dec. 2, 2019)
Available at https://www.irs.gov/pub/irs-drop/n-19-63.pdf
The IRS has announced limited relief for Form 1095-B and 1095-C information reporting for the 2019 tax year. The following provisions largely follow prior years’ guidance (see our Checkpoint article):
Deadline for Furnishing Statements to Individuals. The deadline for furnishing Forms 1095-B and 1095-C to individuals is extended from January 31 to March 2, 2020. (This is effectively a 30-day extension, taking into account that 2020 is a leap year and March 1 falls on a Sunday.) Due to this automatic extension, the permissive 30-day extension is not available, and no further extensions may be obtained. The IRS will not formally respond to any previously submitted deadline extension requests.
No Extension for Filing Returns With the IRS. The relief does not apply to filings with the IRS. The deadlines will be February 28, 2020, for paper filings and March 31, 2020, for electronic filings. Filers may extend these deadlines by application to the IRS.
Good Faith Penalty Relief. No penalties will be imposed on entities that report incorrect or incomplete information—either on statements furnished to individuals or returns filed with the IRS—if they can show they made good faith efforts to comply with the reporting requirements. Penalty relief is not available to entities that fail to furnish statements or file returns; miss an applicable deadline; or are otherwise not making 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, or testing the ability to transmit data to the IRS.
The IRS has expanded relief for reporting 2019 enrollment information, noting that because the individual shared responsibility penalty was reduced to zero starting in 2019 (see our Checkpoint article), individuals no longer need this information to compute their federal tax liability or to file a federal income tax return. (As a reminder, coverage providers generally report enrollment information to individuals using Form 1095-B. However, applicable large employers (ALEs) sponsoring self-insured health plans report enrollment information for employees on Part III of Form 1095-C.) The IRS will not assess penalties against coverage providers that fail to automatically furnish Forms 1095-B to individuals so long as a Form 1095-B is furnished within 30 days after an individual’s request. Reporting entities must prominently post a notice on their website with information about requesting Form 1095-B. Similar relief applies to ALEs that fail to automatically furnish Forms 1095-C to employees who were not full-time for any month in 2019, so long as the form is furnished on request and the website notice is provided.
EBIA Comment: The IRS emphasizes that the Form 1095-C reporting relief does not apply to an ALE’s full-time employees, so self-insured ALEs must continue to report enrollment information for full-time employees (and their family members) on Part III of the form. Also, coverage providers and ALEs will still have to file enrollment information with the IRS—the relief applies only to furnishing forms to individuals. For more information, watch for the 2019 update to EBIA’s Form 1094/1095 Workbook, including Sections IX (“Furnishing Employee Statements”) and X (“Filing With the IRS”). See also EBIA’s Health Care Reform manual at Sections XXVIII (“Shared Responsibility for Employers (Play or Pay Penalty Tax)”), XXXVI.C (“Information Reporting of Minimum Essential Coverage (Insurers and Employers That Self-Insure)”), and XXXVI.D (“Information Reporting of Employer-Sponsored Coverage (Applicable Large Employers)”). You may also be interested in our webinar “1094/1095 Reporting for 2019” (recorded on 12/4/19).
Contributing Editors: EBIA Staff.