IRS Extends Deadline for Certain ACA Reporting Requirements

Faegre Drinker Biddle & Reath LLP

Faegre Drinker Biddle & Reath LLP

In Notice 2020-76 (Notice), the IRS extended the deadline from January 31, 2021, to March 2, 2021, for furnishing Forms 1095-B and 1095-C to individuals for reporting year 2020. Note that the Notice does not extend the deadline to file Forms 1094-B, 1095-B, 1094-C or 1095-C with the IRS. Those forms must be filed with the IRS by March 1, 2021 or if filed electronically, by March 31, 2021.

The Notice also extends “good-faith” reporting relief for employers that report incomplete or incorrect information on their returns (such as missing taxpayer identification numbers or dates of birth).  This relief is available only when the employer can show it made a good-faith effort to comply with the filing requirements, such as gathering and transmitting the necessary data to an agent to prepare the data for submission, or testing its ability to transmit information to the IRS.  The IRS has provided this good-faith relief in the past, but the Notice states that the 2020 reporting year will be the final year this type of relief is available.

In addition, the Notice provides relief for reporting entities that fail to provide a Form 1095-B to a responsible individual, provided the entity (1) prominently posts a notice on its website stating that responsible individuals may receive a copy of their 1095-B upon request, accompanied by an email address, physical address and contact phone number, and (2) provides a 2020 Form 1095-B within 30 days of the date requested. This relief does not extend to the requirement that a sponsor of a self-insured plan provide a Form 1095-C to each full-time employee. However, relief from reporting penalties for sponsors of self-insured plans that fail to furnish Form 1095-C for non-full-time employees is available.

As a reminder, the penalties for noncompliance can be significant – the IRS may impose a penalty of up to $280 per return for failing to timely provide a Form 1095-C or 1095-B to an individual (or providing an inaccurate form), and an additional $280 per return for failing to provide a Form 1094-C, 1095-C or 1095-B to the IRS (or providing an inaccurate form).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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