President Biden Signs ACA Reporting Changes into Law

January 14, 2025

On December 23, 2024, President Biden signed the Paperwork Burden Reduction Act (PBRA) and Employer Reporting Improvement Act (ERIA) into law.

As previously reported in our December 17, 2024, announcement, this legislation makes certain modifications to the ACA’s employer mandate reporting requirements that aim to simplify Forms 1095-B and 1095-C reporting for employers and health insurance providers, as highlighted below.

Paperwork Burden Reduction Act (PBRA)

• Provides statutory authority for the IRS’s allowance for employers to distribute copies of Forms 1095-B and 1095-C to full-time employees and individuals only upon request, subject to the furnishing of a notice of availability. Employers would still be required to annually file Forms 1095-B and 1095-C with the IRS.

  *Please see our Alert: Upcoming ACA Form Reporting Deadlines and Important Update in this edition of Compliance Corner for important information regarding 2025 implementation of this optional new relief.

Employer Reporting Improvement Act (ERIA)

• Provides statutory authority to allow for an individual's date of birth to be substituted for the individual's taxpayer identification number (TIN) for purposes of section 6055 minimum essential coverage reporting, if the TIN is not available. The IRS already allows for this in certain circumstances.
• Provides statutory authority to more broadly allow employers and providers to electronically distribute Forms 1095-B and 1095-C to individuals. The ERIA amends sections 6056 and 6055 to provide that an individual shall be deemed to have consented to receive the forms electronically if they have affirmatively consented at any prior time (unless they revoke the consent).
• Extends to 90 days the deadline for applicable large employers (ALEs) (generally, employers with 50 or more full-time employees) to respond to a proposed shared employer responsibility payment assessment by the IRS (the “226-J letter”). The IRS currently requires a response within 30 days.
• Establishes by statute a six-year statute of limitations for collecting assessments. The six-year period begins the later of: (1) the due date of forms 1094-C/1095-C; or (2) the date the employer actually files forms 1094-C/1095-C. (The IRS currently takes the position that there is no statute of limitations on collecting assessments.) This change applies to assessments proposed in taxable years beginning after the date of enactment.

Generally, these changes take effect with respect to returns due after December 31, 2024 (i.e., 2024 forms due in 2025). Importantly, these new provisions do not require employers to take any action but offer options to employers that are intended to reduce the burden of reporting.

H.R.3797 - 118th Congress (2023-2024): Paperwork Burden Reduction Act
H.R.3801 - 118th Congress (2023-2024): Employer Reporting Improvement Act