New ACA Draft Forms Released
September 19, 2014
The IRS has released preliminary, unofficial drafts of forms that the Affordable Care Act (ACA) compels employers, plan administrators and employees to file to certify coverages offered and provided to employees in 2015. These forms are:
Form 1095-A (Health Insurance Marketplace Statement) – Form 1095-A is filed by the ACA Exchange to the IRS and to those who enrolled in coverage through the Exchange. This will be used by enrollees in preparing Form 8962(see below).
Form 1095-B (Health Coverage) – This will be filed by health insurance issuers and employers that sponsor self-insured health plans that provide individuals with “minimum essential coverage” to report to the IRS and to enrollees information concerning the type and period of coverage offered for the purposes of administering the ACA’s individual shared responsibility provisions.
Form 1095-C (Employer-Provided Health Insurance Offer and Coverage) – Large employers will file Form 1095-C to provide information to the IRS and to employees about the type of health coverage offered to their employees for purposes of the large employer “pay or play” mandate. The form provides information on the coverage provided, and on to whom and when the coverage was offered. The IRS will use Form 1095-C to determine whether the employer owes payments under the employer shared responsibility provisions.
As part of an effort to streamline the reporting process, applicable large employers that sponsor self-funded health plans are to report the information required of them for both the individual (1095-B) and employer mandates (1095-C) on a single combined form using Form 1095-C.
Form 8962 (“Premium Tax Credit”) – Using information from Form 1095-A, subsidized exchange purchasers will file Form 8962 with Form 1040 to determine the amount of premium tax credits they should be reporting on their Form 1040. If they took advanced credits (reduction of insurance premiums purchased on Exchange), this form will calculate whether they need to take additional credits on their Form 1040 (because not enough advanced credit was taken) or pay back amounts for taking more advanced credits than should have been taken.
Form 8965 (“Health Coverage Exemptions”) – Individual mandate exemptions are claimed on Form 8965. This form is prepared by taxpayers and will be filed with Form 1040.
The IRS release suggests that further mandate enforcement delays are not under consideration. Though the official forms and instructions for their use will not be available for months, this early look should help employers and their benefit administration partners assess the significant administrative burdens to come.
And yes, it is true: A draft of the 2014 Form 1040 reveals that the individual mandate has been covered by way of a query on Line 61.