Section 6055 and 6056 ACA Reporting Extension: For many, a sigh of relief

The IRS recently announced that it is extending some Affordable Care Act (ACA) reporting deadlines for employers in order to help them meet new requirements. For many, this news (released through notice 2016-4) has been greeted with a sigh of relief.

ACA_logoFiling of Employer-Provided Health Insurance Offer and Coverage via forms 1094B and 1094C (Employer Transmittals)—as well as the distribution of Transmittal of Health Coverage Information Returns via forms 1095B and 1095C—has been delayed. This gives some additional months’ worth of breathing room to those who might be feeling short on time.

Specifically, this notice extends the due dates for furnishing employee notices from February 1, 2016 to March 31st, 2016, and extends the filing deadline for employers from February 29th, 2016 to May 31st, 2016—for those filing on paper. For electronic filers, that filing deadline has been extended to June 30, 2016.

Further, the notice offers guidance to employees who were unable to qualify for a premium tax credit based on affordability. Those employees will typically rely on payroll data or other data provided by their employer to determine eligibility for tax credits when filing their returns.

Because those individuals might not receive 1095s in time for filing tax returns, they may be wondering what steps they should take once they do receive them. According to the notice, they need not amend their returns, but should simply keep the information on file.

Similarly, individuals who would typically rely on the information provided by the 1095B or C to prove minimum essential coverage under 36B and 5000A need not amend returns once they receive their 1095s. Again, they are guided to keep the information on file.

This extension provides an extension for this year only. Employers are still encouraged to provide the employee notices and file as soon as they are ready. Our recommendation? Take this as an opportunity to address the new requirement without the added stress of urgency—not as a license to procrastinate until the deadline is once again hard upon us.

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