Update on Health Insurance Plan Reporting

The IRS released IRS Health Care Tax Tip 2015-42 on July 21, 2015 and updated it on July 28, 2015. This notice was a reminder to all providers of health coverage, including employers that provide self-insured coverage, that they must file annual returns with the IRS reporting information about the coverage and about each covered individual. Insurance companies must also report on coverage under employer plans that are insured.

Employers will be reporting this information on Forms 1094-B and 1095-B or on Forms 1094-C and 1095-C, depending on whether the employer is an applicable large employer for purposes of the employer shared responsibility provisions. An applicable large employer is defined as an employer that employed an average of at least 50 full-time employees – including full-time equivalent employees – in the preceding calendar year.

If the employer providing self-insured coverage is not an applicable large employer, then they must:

  • Report the coverage on Form 1095-B, along with the Form 1094-B transmittal.
  • Furnish a copy of the 1095-B to the applicable employee.   

An Employer providing self-insured coverage and that is an applicable large employer, will generally report information regarding coverage of eligible employees and their covered dependents on Form 1095-C, not a Form 1095-B. 

These reporting requirements initially kick in for coverage provided in 2015. Therefore, the information forms mentioned above will be due to the IRS in early 2016.

Providers will be reporting the following information to the IRS:

  • The name, address, and employer identification number of the provider.
  • The statement recipient’s name, address, and taxpayer identification number, or date of birth if a TIN is not available. 
  • The name and TIN, or date of birth if a TIN is not available, of each individual covered under the policy or program and the months for which the individual was enrolled in coverage and entitled to receive benefits.
    I urge you to review my earlier posting  on this topic. If you are an employer or work for an employer as a financial executive, controller or CFO and your business provides any sort of health care insurance coverage for its employees (self-insured or not), you’ll want to address these new reporting issues as soon as possible.
  • First, determine what your reporting requirements are.   
  • Second, determine who will generate these information forms.    
  • Last, determine how much it will cost for you to get the reporting done.     

This is definitely one of those instances where you’ll want to be proactive and not wait until year-end to sort this all out!

Daniel Gibson CPA has almost 30 years of experience in public accounting, providing accounting, tax and consulting services. Dan is a member of the AICPA and NJ Society of CPAs.

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