Under the Affordable Care Act’s reporting requirements that have been the subject of this series, statements to responsible individuals (a/k/a “employees”)—i.e., Forms 1095-B and 1095-C—must be furnished on or before January 31 of the year following the calendar year of coverage. The IRS may grant an extension of time of up to 30 days for the provider to furnish the statement. Similarly, transmittal forms—Forms 1094-B and 1094-C—must be submitted to the IRS in either paper format by February 28, or electronic format by March 31, of the year following the calendar coverage year. (For 2016, the January 31 and February 28 due dates fall on weekend days; accordingly, in 2016 these dates are February 1 and February 29 respectively.) Groups that file 250 or more returns must file electronically.
Responding to pleas from a handful of major trade and industry associations, the Treasury Department and the Internal Revenue Service yesterday delayed these requirements.
Specifically, in Notice 2016-4, the regulators extended the deadlines:
For furnishing to individuals the 2015 Form 1095-B, Health Coverage, and the 2015 Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from February 1, 2016, to March 31, 2016, and
For filing with the Service the 2015 Form 1094-B, Transmittal of Health Coverage Information Returns, the 2015 Form 1095-B, Health Coverage, the 2015 Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and the 2015 Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from February 29, 2016, to May 31, 2016, if not filing electronically, and from March 31, 2016, to June 30, 2016 if filing electronically.
According to Notice 2016-4: “In view of these extensions, the provisions regarding automatic and permissive extensions of time for filing information returns and permissive extensions of time for furnishing statements will not apply to the extended due dates.” Thus, there is no need for employers to seek separate extensions of time. The notice also recognizes that some employers might miss even the newly extended due dates. These employers are nevertheless encouraged to comply late, in which case:
[T]he Service will take such furnishing and filing into consideration when determining whether to abate penalties for reasonable cause. The Service will also take into account whether an employer or other coverage provider made reasonable efforts to prepare for reporting the required information to the Service and furnishing it to employees and covered individuals, such as gathering and transmitting the necessary data to an agent to prepare the data for submission to the Service, or testing its ability to transmit information to the Service. In addition, the Service will take into account the extent to which the employer or other coverage provider is taking steps to ensure that it is able to comply with the reporting requirements for 2016.
Notice 2016-4 also provides parallel relief to individuals who file their tax returns before receiving a Form 1095-C. These individuals are not required to amend their returns after receiving these forms late.
The notice recognizes that some employees and related individuals who enrolled in coverage through a public insurance exchange could be adversely affected by the extension. For 2015 only, these individuals are entitled to rely on “other information received from employers about their offers of coverage” for purposes of determining eligibility for the premium tax credit when filing their income tax returns. Even these individuals are not required to file amended returns once they receive their Forms 1095-C. Individuals need not send this information to the Service when filing their returns but should keep it with their tax records. Similar relief is provided in the case of Form 1095-B. For 2015 only, individuals who rely upon other information received from their coverage providers about their coverage for purposes of filing their returns need not amend their returns once they receive the Form 1095-B.
The relief provided in Notice 2016-4 overrides individually-filed extensions of time to file or furnish 2015 returns and information statements. These requests will not be formally granted.