Alert: Upcoming ACA Form Reporting Deadlines and Important Update

Background

Applicable large employers (ALEs) with 50 or more full-time employees (FTEs), including full-time equivalent employees, in the prior year must comply with IRC Section 6056 reporting in early 2025. Specifically, ALEs must complete and file Form 1095-C for full-time employees with the IRS by Sunday, March 31, 2025. The form should include details regarding whether the employee was offered minimum value, affordable coverage during 2024.

Additionally, employers with a self-insured plan during 2024 must comply with Section 6055 reporting in 2025. Self-insured ALEs must complete Section III of Form 1095-C detailing which months the employee (and any applicable spouse and dependents) had coverage under the employer's plan. Self-insured employers with fewer than 50 FTEs must complete Form 1095-B with such information.

Alternative Manner of Furnishing Health Coverage Information Forms (“Upon-Request” Option)

Furnishing Form 1095-B and Form 1095-C to Part-Time and Nonemployees

If a self-insured employer has fewer than 50 FTEs, an alternative remains available for distributing Form 1095-B to individuals. These small employers are permitted to post a clear and conspicuous notice on a website (accessible to individuals who may request a form) of the document's availability and the necessary contact information (email address, physical address and phone number) to request it. Any such request must be fulfilled within 30 days. This option is also available to deliver Form 1095-C to part-time and nonemployees.

Furnishing Form 1095-C to Full-Time Employees – Paperwork Burden Reduction Act (Updated February 25, 2025)

Under prior guidance, Form 1095-C must be delivered to full-time employees by March 3, 2025, by mail, hand delivery, or electronic delivery (the latter only if proper consent is provided in accordance with IRS instructions). However, under the Paperwork Burden Reduction Act (PBRA), which was recently enacted, employers have the option to provide Form 1095-C to such employees only upon request. (For more information on changes to ACA reporting under the PBRA and the Employer Reporting Improvement Act, please see our related article. Such requests must be fulfilled within 30 days after the date of the request.

The IRS recently issued Notice 2025-15, which clarifies how employers can utilize the alternative manner to furnish Form 1095-C. Employers may use the same format as allowed for Form 1095-B but must substitute the term “full-time employee” for “responsible individual” and the term “Form 1095-C, Employer-Provided Health Insurance Offer and Coverage” for “Form 1095-B, Health Coverage.” Detailed information on the required verbiage can be found in the Form 1095-B instructions under the section “Alternative manner of furnishing statements.”

Employers who elect to use this new alternative method for furnishing 1095-Cs for the 2024 calendar year must post a required notice on their website by March 3, 2025. The notice must be posted in a location that is reasonably accessible to all full-time employees and state that a copy of the statement is available upon request. The notice must be written in plain language in a font size large enough to draw an employee’s attention and include the necessary contact information (email address, physical address and phone number) for the employee to request or inquire about it. The notice must remain on the website through October 15 of the year following the calendar year to which the statement relates.

It is important for employers to weigh the pros and cons of using the upon-request option for furnishing Form 1095-C to full-time employees for the 2024 reporting period. For many employers, it may make sense to maintain past automatic delivery practices for this 2024 reporting year. At this late date, employers likely have engaged ACA reporting vendors to distribute Form 1095-C. Given the short timeframe (the Forms must be distributed by March 3), the conservative approach is to distribute the 2024 Form 1095-C as usual and consider the upon-request option next year. Also note that state individual mandates in CA, DC, MA, NJ, and RI generally require employers to distribute Form 1095-C/B to employees residing in those states by separate annual deadlines.

Electronic IRS Filing Requirement

Finally, as a reminder, employers that file 10 or more returns of any type (i.e., counting Forms 1094-B/1095-B, 1094-C, W-2, and 1099 together) to the IRS in a calendar year must do so electronically absent a hardship waiver; please see our article for more information on this change that commenced last year. For those employers still able to file by paper, the filing deadline is February 28, 2025.

For further information on the reporting requirements, please refer to the IRS forms and instructions below. PPI Clients can download a copy of the publication ACA: FAQs for Employer Reporting Under Sections 6055 and 6056 from the Client Help Center.

Instructions for Forms 1094-B and 1095-B (2024) | Internal Revenue Service
2024 Form 1094-B
2024 Form 1095-B
Instructions for Forms 1094-C and 1095-C (2024) | Internal Revenue Service
2024 Form 1094-C
2024 Form 1095-C