Feds release draft tax forms for employer compliance with ACA

The Internal Revenue Service on Thursday released drafts of the forms employers will use to report on health coverage they offer to their employees, unveiling a glimpse of the administrative onus in store for benefit advisers and their employer clients working to comply with the Affordable Care Act.

Despite continuing calls to further delay the mandate and confusion about employer shared responsibility requirements following conflicting court rulings just this week on ACA subsidies offered on the federal exchange, the IRS posted to its website draft forms for employers and individuals to use when reporting their health coverage starting in 2015.

The draft forms have been provided to help stakeholders, including employers, tax professionals and software providers, prepare for the new reporting provisions and to invite comments from them, the agency says.

While the forms provide benefit advisers and employers a much needed preview of forthcoming reporting requirements, there remains the possibility that the finalized versions of the forms will look different.

“While more information is better, the caveat is that the forms are subject to change,” says Les McPhearson, CEO of United Benefit Advisers. “The question for employers and advisers remains — ‘How invested do I get in this?’”

He adds, however, that the forms could be helpful “in providing a glimpse of where the IRS, Department of Health and Human Services and Centers for Medicare and Medicaid Services are heading in terms of accounting, administration, and reporting requirements.”

The IRS says it anticipates draft instructions relating to the forms will be posted to its website in August and both the forms and instructions will be finalized later this year.

The agency says it has simplified the paperwork and reduced the number of forms and categories some companies will be required to complete. For example, the forms allow some employers to check a box that says an employee is covered on the employer-sponsored group plan for 12 months, rather than reporting coverage on a monthly basis.

The forms aim to fulfill the reporting requirements as follows: 6055 COMPLIANCE 6056 COMPLIANCE Health insurance issuers, sponsors of self-funded health plans, and other entities that provide minimum essential coverage (MEC) must file: Applicable large employers that employed an average of at least 50 full-time employees (including full-time equivalents) on business days during the preceding year must file: Form 1095-B Form 1095-C Form 1094-B transmittal page Form 1094-C transmittal page

 















Special Rule: As part of an effort to streamline the reporting process, applicable large employers that sponsor self-funded health plans are to report the information required of them for both the individual and employer mandates on a single combined form using Form 1095-C. Substitute forms will be permitted if they include all of the content required by the prescribed forms and meet other IRS requirements.

Early releases of draft forms and instructions are at IRS.gov/draftforms.  Please note that drafts may remain on IRS.gov even after the final release is posted at IRS.gov/downloadforms, and thus may not be removed until there is a new draft for the subsequent revision. All information about all revisions of all forms, instructions, and publications is at IRS.gov/formspubs

 


Source: Employee Benefits Adviser