The IRS recently released Notice 2020-76 extending relief to employers from some of the reporting requirements under the employer mandate for the 2020 reporting year. For context, the Affordable Care Act’s (ACA’s) employer mandate requires health insurance issuers, applicable large employers, and sponsors of self-insured group health plans to report information to the IRS and individuals regarding their health insurance. The Notice provides a delay in the deadline for distribution of Forms 1095-B and 1095-C to participants by employers, health insurers, and other reporting entities from Jan. 31, 2021, to March 2, 2021. However, the IRS has not extended the deadline for filing Forms 1094-B and 1094-C, so these forms must still be filed with the IRS no later than March 1, 2021 (or March 31, 2021, if filed electronically).
Because the individual shared responsibility payment has been reduced to $0 as of Jan. 1, 2019, the Notice provides that the IRS will not assess a penalty for failing to furnish Form 1095-B to individuals if two conditions are met. First, the employer must post a prominent notice on their website stating that individuals may receive a copy of their statement upon a request, along with a phone number to ask questions and an email address and physical location where such request may be sent. Second, the reporting entity must actually furnish forms to individuals within 30 days that the request is received.
Who does the relief apply to?
The above relief does not apply to ALEs filing Forms 1095-C for full-time employees, but it does apply to non-full-time employees enrolled in their self-insured group health plan. Additionally, it does not affect penalties relating to the requirement to file applicable forms with the IRS.
How does the relief effect due dates?
Due to the COVID-19 pandemic, the IRS recognizes that employers may have difficulty gathering all of the information necessary to complete these forms by the respective due dates. The recent notice extends the due date to furnish information returns to individuals from Jan. 31st to March 2, 2021. As a reminder, there is a 30-day extension available for filing with the IRS the 2020 Forms 1094-B and 1094-C (with the applicable Forms 1095) that is granted automatically simply by filing Form 8809 with the IRS on or before the filing due date (an additional 30-day extension is available for certain hardship situations). However, the IRS will not grant a request for an additional 30-day extension of time to furnish Forms 1095 to individuals.
Additional information on the relief.
Finally, the IRS extended the relief from penalties to reporting entities that report incorrect or incomplete information on Form 1094 or 1095 upon a showing of a good faith effort to comply with the applicable information-reporting requirements. This is the last year that the IRS intends for this relief to apply.
How PrimePay can help ensure compliance.
Our ACA Compliance Navigator solution helps with variable hour employees, file and provide IRS Forms 1094/1095, and provides penalty exposure warnings, checklists, and more. Contact our ACA team at 877-479-2996 for more information or connect with a Sales Team Member by filling out the form below to subscribe to the ACA service.
Disclaimer: Please note that this is not all inclusive. Our guidance is designed only to give general information on the issues actually covered. It is not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion. Consult your own legal advisor regarding specific application of the information to your own plan.