Final Regulations: Information Reporting of Health Insurance Coverage and Other Issues under Sections 5000A, 6055, and 6056, 26 CFR Parts 1 and 301, 87 Fed. Reg. 76569 (Dec. 15, 2022)
The IRS has released final regulations addressing extended deadlines for certain Affordable Care Act (ACA) information reporting requirements. As a reminder, Forms 1094-B and 1095-B are filed by minimum essential coverage providers (insurers, government-sponsored programs, and some self-insuring employers and others) to report coverage information in accordance with Code § 6055. Forms 1094-C and 1095-C are filed by applicable large employers (ALEs) to provide information that the IRS needs to administer employer shared responsibility penalties and eligibility for premium tax credits, as required under Code § 6056. The final regulations generally apply for calendar years beginning after December 31, 2021. (Extensions for previous years were covered by IRS guidance and the proposed regulations—see our Checkpoint article.) Here are highlights:
Deadline for Furnishing Statements to Individuals. The regulations permanently extend the deadline for furnishing a given year’s Forms 1095-B and 1095-C to individuals until 30 days after January 31 of the immediately following year (or the next business day, if the 30th day falls on a Saturday, Sunday, or legal holiday). The extension replaces the 30-day extension that could be requested for good cause, and the IRS’s ability to provide blanket automatic extensions. [EBIA Comment: Although the final 2022 reporting forms have been released, the 2022 instructions have not been finalized—see our Checkpoint article. Nevertheless, the draft 2022 instructions incorporate the automatic 30-day extension (from January 31 to March 2, 2023) for furnishing Forms 1095-B and 1095-C to individuals.]
Alternative to Automatically Furnishing Certain Statements. Because the individual shared responsibility payment was reduced to zero (see our Checkpoint article), the regulations provide an alternative to automatically furnishing statements in certain situations. A reporting entity is treated as having timely furnished Forms 1095-B to individuals so long as a “clear and conspicuous” notice with information about how an individual can request the form is prominently posted on the reporting entity’s website, and a Form 1095-B is furnished within 30 days after an individual’s request is received. The notice must be posted by the deadline for furnishing statements and remain in the same location on the website until October 15 of the year following the calendar year to which the statement relates. Similar relief is available to ALEs with respect to furnishing Forms 1095-C to non-full-time employees and non-employees enrolled in the ALE’s self-insured health plan, but not for furnishing statements to full-time employees. This relief does not apply to reporting information to the IRS.
Elimination of Transitional Penalty Relief. The transitional good faith relief from penalties for reporting incorrect or incomplete information on returns or statements is not available for tax year 2021 or subsequent years.
EBIA Comment: The proposal also included a renewed request for comments on regulations proposed in 2016 regarding, among other things, reporting for catastrophic plans and the possible use of truncated TINs (see our Checkpoint article). The IRS reports in this final version that it continues to consider the 2016 proposed regulations in light of the comments received in 2016 and in response to the request in the 2021 proposed regulations, and it expects to finalize the 2016 proposed regulations separately. For more information, watch for the upcoming 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)”).
Contributing Editors: EBIA Staff.