Dec. 29, 2015 – Compliance Observer Alert – IRS Delays 2015 Due Dates for ACA Reporting

Oct. 24 Compliance Observer Alert

December 29, 2015

IRS DELAYS 2015 DUE DATES FOR ACA REPORTING

On Monday, December 28, 2015, the Internal Revenue Service (IRS) issued Notice 2016-4 extending the due dates for information reporting by insurers and self-insured employers as required by the Affordable Care Act and Sections 6055 and 6056 of the Internal Revenue Code. These extensions were provided as the IRS determined that “some employers, insurers, and other providers of minimum essential coverage need additional time to adapt and implement systems and procedures to gather, analyze, and report information.” Indeed, these extensions will provide much relief to many such employers and insurers and give them more time to prepare.

The Notice extends the 2015 due dates for providing both individuals with their required statements and filing the applicable forms with the IRS. Specifically, the new due dates are as follows:

  • 2015 Form 1095-B and 2015 Form 1095-C to individuals: March 31, 2016 (extended from January 31, 2016).
  • 2015 Form 1094-B and 2015 Form 1094-C to the IRS if not filing electronically: May 31, 2016 (extended from February 28, 2016).
  • 2015 Form 1094-B and 2015 Form 1094-C to the IRS if filing electronically: June 30, 2016 (extended from March 31, 2016).

Since all of the due dates were extended, the Notice states that previously-issued provisions addressing automatic extensions and permissive extensions (read more HERE) will not apply to the extended due dates. Therefore, employers and insurers that do not furnish and file the forms by the due dates indicated above may be faced with penalties under IRC §§6722 or 6721. However, since the IRS takes furnishing and filing into consideration when looking at possible abatement of penalties for reasonable cause, employers should still furnish and file the forms even if they miss the extended deadlines.

Additionally, the Notice also provides guidance for individuals who would need their 1095-C or 1095-B prior to filing their tax returns but who now, due to the extensions, may not receive them. Individuals who enrolled in coverage through the Marketplace would need their 1095-C to determine if their employer-sponsored coverage was affordable prior to filing their tax returns. Likewise, some individuals would need their 1095-B or 1095-C to confirm they had minimum essential coverage. The Notice clarifies that for 2015, individuals in these circumstances may rely upon other information about their coverage received from their employers or coverage providers, as applicable, when filing their income tax returns. Individuals do not need to send the information on which they rely to the IRS but should instead keep it with their tax records.

Though we do not believe that this guidance requires an employer to provide any additional notice to individuals explaining their offer of coverage or other coverage details, employers should be ready to address this with affected individuals and may want to have information prepared in advance to distribute if requested.  To assist you, your AssuredPartners NL broker can provide a sample document that you may use for this purpose.  Once individuals do receive their 1095-B or 1095-C, they do not need to amend their tax returns.

Although the IRS has extended these due dates, the Notice indicates that the Service is still prepared to accept filings beginning in January 2016. As such, the Notice urges employers and insurers not to wait to furnish their individual statements and file their returns but to do so as soon as they are ready.

The full text of IRS Notice 2016-4 can be found HERE.

If you are an employer using Assured Answers to assist with your reporting obligations, you will receive a separate email with information on how to choose from one of the following options:

  • Maintain the original project timeline–submit information to Assured Answers by 1/8/16 with a fulfillment date of 2/1/16.
  • Extend the project timeline–information will be due to Assured Answers by 2/5/16 with a fulfillment date of 3/1/16.

Or you can go to www.AssuredAnswers.com to read about your options. 

Source: IRS; CIAB

 

Please contact your AssuredPartners NL Benefit Team if you have questions or need assistance with these or other compliance matters

Information contained herein is for educational and/or informational purposes only.   The information provided may change over time as the laws and regulations change. This information is not, nor is it intended to be, legal advice and each employer or client should seek their own legal counsel for guidance regarding individual situations.

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