GUIDANCE FOR COMPLETING FORM 1095-C AND FORM 1094-C

Transcription

1 GUIDANCE FOR COMPLETING FORM 1095-C AND FORM 1094-C FOR WHICH EMPLOYEES MUST A MIIA TRUST MEMBER COMPLETE FORM 1095-C? Members of the MIIA Trust will complete Parts I and II of Form 1095-C for every employee who was employed in full-time status (i.e. averaging at least 30 hour per week) at any time during Members of the Trust should not complete Part III of Form 1095-C or check the box at the top of Part III. FILLING-OUT FORM 1095-C PART II FOR ACA FULL-TIME EMPLOYEES Plan Start Month This box is optional for If you wish to complete it, enter the two-digit number (01 through 12) for the calendar month during which your plan year begins. Line 14 Offer of Coverage If the individual is an ACA full-time employee at any time during the calendar year the Employer should complete Line 14 as follows (unless the offer of coverage may be considered a Qualifying Offer): a.) The municipal Employer should enter Code 1E for every full month that the employee was offered coverage b.) For any month that the employee was not offered coverage (including any month of the employee's first three (3) calendar months of full-time employment for which the employee is not offered coverage) Employer should enter Code 1H. (For example, for an employee who was hired on September 2 but whose coverage was not effective until October 1, the Employer should enter Code 1H for September and Code 1E for October and succeeding months s/he was employed. If the employee was not offered coverage until October 2, the Employer will enter Code 1H for September and October and Code 1E for succeeding months that the employee was employed. (Employer can claim an offer of coverage for the month only if coverage offered for the entire month.) Also, for any month during a variable hours, part-time or seasonal employee's initial measurement period for which the employee is not offered coverage Employer should enter Code 1H.

2 c.) If an employee terminates employment during a month and his/her coverage terminates before the end of that month, Employer would enter Code 1H for that month (as well as for succeeding months). d.) If an employee terminates during a month but is provided coverage for the duration of that month, the Employer should enter Code 1E for that month. QUALIFYING OFFER If the Employee's Share of the premium for the lowest cost Individual coverage available through the Employer is less than $94.05 per month the Employer may consider its offer of coverage a Qualifying Offer. If Employer designates its offer as a Qualifying Offer it may, for any month (or all 12 months) that a Qualifying Offer is made to an employee: a.) Place Code 1A in any box on Line 14 where Code 1E would otherwise be placed. b.) Leave Line 15 (Employee's Share of Lowest Cost Monthly Premium ) blank. c.) Provide each employee who received a qualifying offer for all 12 months a statement (rather than a copy of her/his Form 1095-C) that includes: Identifying information about the employer Contact information for an individual responsible for answering questions about the employer's health plan A statement that for all 12 months of the calendar year, the employee and his or her dependents received a qualifying offer of coverage and are not eligible for a premium tax credit, and directing the employee to see IRS Pub. 974 for further information regarding eligibility for the premium tax credit. Line 15 Employee Share of Lowest Cost Monthly Premium for Self-Only Minimum Value Coverage A municipal employer will complete Line 15 only if Code 1E is entered in a box or boxes (or in the "All 12 months" box) on line 14 and only in the box or boxes for the months that Code 1E is entered. For those months, enter the amount of the employee's share of the lowest cost monthly premium for Individual coverage offered by the Employer and available to the employee. Enter the full amount including cents. If the amount of the employee's premium share changes at any time during the year due to increased premium rates, change in contribution percentage, or any other reasons(s), insert in the applicable box the changed amount. Line 16 Applicable Section 4980H Safe Harbor A municipal employer will enter the following codes on Line 16 If the employee is enrolled in the coverage offered on each day of the month Code 2C

3 If an employee was not enrolled and was not employed on every day during the month If the employee was not a full-time employee for the month and not enrolled. Use this code for month employee terminates employment if loses coverage before end of the month If the employee is a full-time employee but is not offered coverage during the period starting with the first date of employment and including the first 3 full calendar months of employment Code 2A Code 2B Code 2D Also enter Code 2D if employee is in an initial measurement period for that month. Note: If an employee is not enrolled in coverage for a reason other than those listed, above, the Employer need not enter any Code at Line 16. For example, if the employee was offered coverage but, instead, was enrolled in coverage offered by her/his spouse 's employer, the Employer may leave Line 16 blank. Alternatively, the Employer may, if it has selected an affordability safe harbor for the employee, and if the employee satisfies that safe harbor, designate the Code for the selected safe harbor as follows: Form W-2 Safe Harbor Federal Poverty Line Safe Harbor Rate of Pay Safe Harbor Code 2F Code 2G Code 2H COBRA If upon her/his termination an employee is offered COBRA, the Employer would, for the month during which the employee terminates and loses coverage, enter Code 1H on Line 14 and Code 2B on Line 16. For the remaining months of the 2016 calendar year, the Employer would enter Code 1H on Line 14 and Code 2A on line 16.

4 FORM 1095-C, LINES 14-16, CODING EXAMPLES Listed, below, are Form 1095-C coding directions for various scenarios. For purposes of these scenarios, we will assume that, pursuant to its enrollment guidelines, the city or town provides coverage to an ACA full-time employee on her/his first day of employment and terminates coverage effective on the employee s termination date. The coding directions will differ slightly for employers with different enrollment guidelines. (Please note that "Employee's share of premium" is used, below, as a short-hand for "employee's share of the premium cost for the lowest cost Individual coverage offered by the Employer.") ACA full-time employee (30+ hours) employed for entire 2016 calendar year and enrolled in Employer's coverage for entire year: Jan. Dec. Line 14-1E ACA full-time employee employed for entire 2016 calendar year but not enrolled (i.e. declined enrollment) in Employer's coverage: Jan. Dec. Line 14-1E Line 16 - Employer may utilize code for affordability safe harbor if, using that safe harbor, coverage is affordable for employee. Alternatively, may leave line blank. ACA part-time employee, but eligible for coverage under c. 32B, employed for entire 2016 calendar year and enrolled in Employee's coverage for entire year. Employer does not forward or file Form 1095-C for this employee. Coverage documented by Trust's filing of Form 1095-B for this part-time employee. Hired as ACA full-time employee (30+ hours) on July 15, enrolled in coverage, eff July 15: Jan. June Line 14-1H Line 16-2A July Line 14-1H (Employer cannot claim offer of coverage since less than full month) Line 16-2D (1 st month of employment considered "Limited Non- Assessment Period")

5 Aug. - Dec.- Line 14-1E ACA full-time employee terminates employment on July 15 following which is eligible for COBRA: Jan. June Line 14-1E July - Line 14-1H Line 16-2B Aug. - Dec.- Line 14-1H Line 16-2A Part-time but eligible for coverage under c. 32B and enrolled in Family Coverage, changed to ACA full-time (30+ hours) eff. 7/1 (and remained enrolled in coverage): Jan. June Line 14 1E Line 16 2C July Dec. Line 14-1E Part-time Employee not eligible for Coverage (under ACA or c.32b) changed to full-time (30+ hours) eff. 7/1 with coverage effective 7/1: Jan. June Line 14-1H Line 16-2B July Dec. Line 14-1E Line 15 - employee's share of premium if enrolled in coverage otherwise code for affordability safe harbor (if used)

6 ACA full-time employee Loses Coverage due to Reduction In Hours, eff. 7/1 and is offered COBRA: Jan. June Line 14 1E Line 15 Employee's share of premium Line 16 2C July Dec. Line 14-1E Line 15 - Full COBRA premium (Self-Only) Line 16 - If COBRA accepted 2C If COBRA declined 2B Employee hired as variable hour employee on or after Jan. 1, 2016 with a 12 month initial measurement period that ends after Dec. 31, 2016 (and who is neither offered nor enrolled in coverage): No Form 1095-C need be completed as employee was in a Limited Non-Assessment Period for the entire period that s/he was employed in calendar year Employee hired as variable hour employee on August 1, 2015 with a 12 month initial measurement period that ends on July 31, 2016: A.) If employee is found to have averaged less than 30 hours during the measurement period: No Form 1095-C need be filed for 2016 since employee not a full-time employee B.) If employee averaged 30 hours or more during the measurement period, the employee must be offered coverage for the succeeding stability period. Assuming the employee enrolls in that coverage, Lines of Form 1095-C would be completed as follows: Jan. July Line 14 1H Line 16 2D Aug. - Dec.- Line 14 1E Line 15 Employee's share of premium Line 16 2C Retiree not employed as an ACA full-time employee for any month of 2016 calendar year but enrolled in coverage for the entire 2016 calendar year. Employer does not forward or file Form 1095-C. Retiree's coverage documented by Trust's filing of Form 1095-B.

7 ACA full-time employee enrolled in coverage who retires on June 1 and remains enrolled (as retiree) in coverage for remainder of year: Jan. May Line 14-1E June Dec. Line 14 1H Line 16 2A ACA full-time employee not enrolled in coverage who retires on June 1 and who is not enrolled for coverage as retiree: Jan. May - Line 14-1E Line 16 Could use safe harbor if satisfied, otherwise Blank June Dec. Line 14 1H Line 16 2A It should be stressed that (1) Form C must be completed for every individual who was an ACA full-time employee at any time during the 2015 calendar year and (2) an entry for every month of the 2015 year must be made for every such employee. Members should not complete Part III of Form 1095-C and should not check the box at the top of Part III. (The Trust will file a Form 1095-B for every employee or retiree enrolled in a member's coverage and will provide the same information on Form 1095-B that is requested at Part III of Form 1095-C.)

8 FILLING OUT FORM 1094-C Part I Applicable Large Employer Member (ALE) Fill-out Lines 1-8 Leave Lines 9-16 Blank Line 18 Enter the number of Forms 1095-C that you are filing Line 19 Check the box as your submission will be the "authoritative transmittal." Part II ALE Member Information Line 20 Total number of Forms 1095-C filed by and/or on behalf of ALE member should be the same number entered at Line 18 (unless, for some reason, you are submitting your Forms 1095-C in separate batches). Line 21 Check the NO box. Line 22 Unless the Employee share of the premium for the lowest cost Individual plan year offer is $94.05 or less, you cannot claim a Qualifying Offer and cannot check Box A. If your plan year is other than a calendar year or if you have between 50 and 99 employees you should check Box C Section 4980H Transition Relief for the months in calendar year 2016 that were included in your plan year that began during You may check Box D if you offer coverage that is "affordable" to at least 98% of your full-time employees. (It is questionable whether claiming this method is worthwhile as the margin for error (2%) is very small and the relief available (not having to indicate the number of full-time employees at Part III Column (b)) would not seem to be of substantial value.) Part III ALE Member Information - Monthly Column (a) Minimum Essential Coverage Offer Indicator Check the "YES" box at Line 23 if you offered coverage to at least 95% of your full-time employees for the entire year. However, for months in calendar year 2016 that were included in your plan year that began during 2015 (e.g. Jan. June, 2016 for an Employer with a July 1, 2015 through June 30, 2016 plan year), you may check the "YES" box if you offered coverage to at least 70% of full-time employees. If you did not offer coverage to at least 95% (70% for 2015) of your full-time employees for any month, check the "NO" box at Lines for those months you did not offer coverage to 95% (70% for months during calendar year 2016 that were included in your plan year) of your full-time employees (and the "YES" box for any months you did).

9 Limited Non-Assessment Period In determining the 95%, disregard the period beginning on the employee's start date and ending not later than the end of her/his first three full calendar months of employment. Also disregard an employee's initial measurement period and any associated administrative period. (Above assumes Employer is using the Look-Back Measurement Method.) Column (b) Full-Time Employee Count for ALE Member Enter the number of your full-time (30+ hours) employees for each month. Do not count any employee in a Limited Non-Assessment Period. Column (c) Total Employee Count for ALE Member Enter the total number of your employees for each month, including full-time employees as well as non full-time employees and including employees in a Limited Non-Assessment Period. Column (d) Aggregated Group Indicator Do not check these boxes Column (e) Section 4980H Transition Relief If you have between 50 and 99 full-time employees (or full-time equivalents) enter Code A or if you have 100 or more full-time employees and have a plan year that is not the calendar year, enter Code B, but only for those months in calendar year 2016 that were included in your plan year that began during Part IV Other ALE Members of Aggregated ALE Group You should disregard this Part IV.