hrc blog
ACA Employer Reporting Requirements Extended & Cadillac Tax Delayed
On December 28, 2015, the Internal Revenue Service (IRS) issued Notice 2016-4, extending employer reporting dates (Under the Affordable Care Act), including the requirement for applicable large employers to furnish Form 1095-C to full-time employees, and Form 1094-C to the IRS. On December 18, 2015, President Obama authorized the delay in the implementation of the ACA's "Cadillac Tax" by two years, from 2018 to 2020.
IRS' Notice 2016-4 extends the due date 1) for furnishing to employees the 2015 Form 1095-C (Employer-Provided Health Insurance Offer and Coverage), from 2/1/2016 to 3/31/2016; 2) for filing with the IRS the 2015 Form 1094-C (Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns) and the 2015 Form 1095-C from 2/29/16 to 5/31/2016, if not filing electronically, and from 3/31/2016 to 6/30/2016 if filing electronically.
Form 1095-C includes information on the coverage (if any) offered by the applicable large employer to the full-time employee. The information the Form reports will assist employees in determining eligibility for premium tax credits under the ACA. Form 1095-C must be provided to full-time employees and must also be filed with the IRS.
According to the IRS, they are prepared to accept filings of the information returns on Forms 1094-C and 1095-C beginning in January 2016. However, the IRS encourages employers and other coverage providers to furnish their statements and file the information returns as soon as they are ready.
The Cadillac tax was set to take effect on January 1, 2018. This tax would have imposed a 40% excise tax on high-cost group health coverage. The tax was intended to discourage high value health coverage. Some studies indicated that the tax would affect about half of U.S. employers in 2018, and more than 80% by 2023. The delay will allow extra time for solutions to be worked on regarding the impact of the tax.