ACA Information Reporting

Transcription

1 ACA Information Reporting Section 6055 & 6056 Forms 1094 and 1095

2 Presented By: Rich Wilber Director, Compliance & Administration Hartman Employee Benefits, Inc. Disclaimer: The content herein is not intended to replace advice provided by legal and tax counsel. For educational purposes only. Please let us know if you have any questions about the content.

3 Approved for Education Credit Activity ID: XXXXXXX Activity ID: XX-XXXXX This activity, Section 6055 & 6056 Reporting - Case Study, has been approved for 1.0 (HR (General)) recertification credit hours toward California, GPHR, HRBP, HRMP, PHR and SPHR recertification through the HR Certification Institute. Please be sure to note the activity ID number on your recertification application form. For more information about certification or recertification, please visit the HR Certification Institute website at Hartman Employee Benefits, Inc. is recognized by SHRM to offer Professional Development Credits (PDCs) for the SHRM-CPSM or SHRM- SCPSM. This program is valid for 1.0 Professional Development Credits for the SHRM-CPSM or SHRM-SCPSM. For more information about certification or recertification, please visit

4 Reporting Requirement SECTION 6055 Providers of Minimum Essential Coverage Insurance carrier, if fully insured Employer, if self-insured Documents compliance with Individual Mandate Reports individual enrollment by month Employee, spouse, children Forms 1094-B & 1095-B (Carrier or Small Employer) 1094-C & 1095-C (Applicable Large Employer) SECTION 6056 Applicable Large Employers 50+ Full-Time including equivalents Including aggregated groups (common ownership) Documents compliance with Employer Mandate Reports offers of coverage Whether offered or not Forms 1094-C & 1095-C

5 Reporting Process & Timeline File to IRS (Form 1094 and each 1095) February 28 (paper, optional <250 returns) March 31 (electronic, mandatory if 250+ returns) Provide statement to applicable employees (Form 1095) January 31 (February 1, 2016 due to January 31 being a Sunday) Delivered to employees in any manner permitted for delivery of Form W-2 Properly addressed and mailed on or before the due date Must obtain consent from the employee if furnished electronically Extensions & Waivers Automatic 30-day extension to file with IRS with Form 8809 Request extension to furnish statements to recipients by letter to IRS Request waiver from electronic filing with Form 8508

6 Information Reporting Penalties Failure to file returns $250 for each return for which failure occurs (limit $3,000,000) Per-statement penalty is increased for intentional disregard 2015 Relief No penalties for incorrect or incomplete information Filer must show good faith effort Other penalties still apply Employer Mandate Individual Mandate

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8 Information for 1095-C Parts I & II Part I Employee - Name, SSN, address Employer - Name, EIN, address, contact telephone Part II (See Instructions) Plan start month (01 12 representing calendar month) Line 14: Offer of coverage code ( 1 series ) Offer of coverage must provide coverage for every day of that month Line 15: Employee share of lowest cost self-only minimum value Depends on 1 series code Line 16: Section 4980H safe harbor code ( 2 series ) if applicable Blank spaces represent potential for penalty (not a definite trigger)

9 1095-C Line 14 1 Series Code MEC, MV, Affordable (FPL), to employee, spouse & children 1B MEC, MV to employee only 1C MEC, MV to employee and at least MEC to children 1D MEC, MV to employee and at least MEC to spouse MEC, MV to employee and at least MEC to spouse & children 1F MEC, NOT MV, to employee with or without spouse & children 1G Offer to non-ft employee No offer of MEC coverage 1I Qualifying offer transition relief 2015 (see 1094, line 22, B)

10 1095-C Line 15 Employee Cost Complete line 15 only if code 1B, 1C, 1D, or is entered on line 14 Enter the amount of the employee share for self-only enrollment in the lowest-cost monthly premium minimum essential coverage providing minimum value that is offered to the employee Enter the amount including any cents Monthly calculation: divide the total employee share of the premium for the plan year by the number of months in the plan year

11 1095-C Line 16 2 Series Code Not employed on any day of the month 2B Not FT for the (entire) month and did not enroll * Enrolled in coverage offered (for each day of the month) 2D Employee in Limited Non-Assessment Period 2E Multiemployer interim rule relief (see instructions, pair with ) 2F Form W-2 affordability safe harbor (must be all months in year) 2G FPL affordability safe harbor 2H Rate of pay affordability safe harbor 2I Non-calendar year transition relief applies *For any month in which an employee enrolled in minimum essential coverage, indicator code reporting enrollment is used instead of any other indicator code that could also apply

12 Definitions - Limited Non-Assessment Period A period during which an employer will not be subject to an assessable payment for a full-time employee, regardless of whether that employee is offered health coverage during that period Five periods described below are Limited Non-Assessment Periods only if the employee is offered health coverage by the first day of the first month following the end of the period, and are Limited Non-Assessment Periods for section 4980H(b) only if the health coverage that is offered at the end of the period provides minimum value.

13 Definitions - Limited Non-Assessment Period 1. January through March of the first calendar year in which an employer is an ALE, but only for an employee who was not offered health coverage by the employer at any point during the prior calendar year 2. Waiting Period under the Monthly Measurement Method 3. Waiting Period under the Look-Back Measurement Method 4. Initial Measurement Period and Associated Administrative Period under the Look-Back Measurement Method 5. Period Following Change in Status that Occurs During Initial Measurement Period Under the Look-Back Measurement Method 6. First Calendar Month of Employment, if the employee s first day of employment is a day other than the first day of the calendar month

14 Information for 1095-C Part III Part III ONLY if self-insured X in the box if necessary Report for HRAs ONLY if individual is not enrolled in a major medical plan of the ALE member (ex. HRA integrated with spousal coverage) Name, SSN (DOB only if SSN unavailable), months covered for employee and any covered dependents (any month with at least 1 day of coverage) Create one 1095-C per FT employee if fully insured FT and/or enrolled employee (even non-ft) is self-insured

15 A Case Study for 1095-C 59 employees started and ended the year as full-time employees with Acme, Inc. (new hire waiting periods previously satisfied) Acme offered MEC & MV coverage to employee, spouse and children Fully-insured MV plan at $200/mo. (single) 1/1/15-6/30/15 Self-insured MV plan at $0/mo. (single) 7/1/15 12/31/15 Following examples: Enrolled all 12 months Waived all 12 months

16 Robert Enrolled West Ave Smithfield PA Acme, Inc Main Street (555) Anytown PA X Robert Enrolled Mary Enrolled X X X X X X X X X X X X Copyright 2015, Hartman Employee Benefits, Inc.

17 Cheryl Waived East Ave Smithfield PA Acme, Inc Main Street (555) Anytown PA I 2I 2I 2I 2I 2I 2G 2G 2G 2G 2G 2G X Copyright 2015, Hartman Employee Benefits, Inc.

18 Cheryl Waived East Ave Smithfield PA Acme, Inc Main Street (555) Anytown PA I 2I 2I 2I 2I 2I 2G 2G 2G 2G 2G 2G X Line 16 January June alternate: 2F if W-2 Safe Harbor 2H if Rate of Pay Safe Harbor Or blank if no safe harbors apply Copyright 2015, Hartman Employee Benefits, Inc.

19 A Case Study for 1095-C Tom Complicated was hired 2/1/2015 for a part-time position Tom was promoted to a full-time position 3/1 with annual salary of $25,000 Acme offered MEC & MV coverage to employee, spouse and children after the new hire waiting period on 4/1 for $200 monthly cost for single coverage $25,000 x 9.5% / 12 = $ (no affordability safe harbor applies) He waived coverage and enrolled on spouse s plan (Susan) Susan s employer introduces spousal carve-out effective 5/1/15 and Tom enrolls in Acme s plan on this qualifying loss of eligibility

20 A Case Study for 1095-C Acme moves to self-funded plan 7/1 and changes contribution to 100% of single rate; Tom continues enrollment as single Susan quits her job and loses coverage 8/1; Tom enrolls her on his plan Child (Billy) is born 9/4 and enrolled on Acme s plan Tom quits his job effective 10/25, coverage ends immediately on date of termination, but Acme offers COBRA coverage Tom elects to continue COBRA coverage for his family for November, but then drops coverage when he finds new employment with health benefits 12/1/15

21 1095-C Part I The Basics Employee Name, SSN, Address Employer Name, EIN, Address, Contact Phone Tom Complicated North Ave Hometown PA Acme, Inc Main Street (555) Anytown PA 12345

22 1095-C Part II - January Date of hire 2/1/2015 No offer of coverage in January () Employee not employed during the month ()

23 1095-C Part II - February Date of hire 2/1/2015 Worked in part-time position for February No offer of coverage in February () Employee not full-time during the month (2B) 2B

24 1095-C Part II - March Promoted to full-time 3/1/15 New hire waiting period; not eligible until 4/1/15 No offer of coverage in March () Employee in a section 4980H(b) Limited Non-Assessment Period(2D) 2B 2D

25 1095-C Part II - April Benefits eligible 4/1/15, but employee waived coverage Employee share of lowest cost self-only MV plan $ (not affordable) Offered MEC & MV to employee, spouse & dependents () Due waiver and unaffordability, no safe harbor applies (Row 16 blank*) B 2D

26 1095-C Part II - May Enrollment occurs 5/1/15 due to qualifying event, loss of other coverage Employee share of lowest cost self-only MV plan $ (not affordable) Offered MEC & MV to employee, spouse & dependents () Employee enrolled in coverage offered () B 2D

27 1095-C Part II - June No change, enrollment maintained in June Employee share of lowest cost self-only MV plan $ (not affordable) Offered MEC & MV to employee, spouse & dependents () Employee enrolled in coverage offered () B 2D

28 1095-C Part II - July Start of 2015 plan year on 7/1/15, self-funded (Part III to follow ) Employee share of lowest cost self-only MV plan $0.00 (FPL affordable) Offered MEC, MV & FPL Affordable to employee, spouse & dependents () Employee enrolled in coverage offered () B 2D

29 1095-C Part II - August Spouse enrolls 8/1/15 based on qualifying event, loss of other coverage Employee share of lowest cost self-only MV plan $0.00 (FPL affordable) Offered MEC, MV & FPL Affordable to employee, spouse & dependents () Employee enrolled in coverage offered () B 2D

30 1095-C Part II - September Child born & enrolled 9/4/15 based on qualifying event, birth Employee share of lowest cost self-only MV plan $0.00 (FPL affordable) Offered MEC, MV & FPL Affordable to employee, spouse & dependents () Employee enrolled in coverage offered () B 2D

31 1095-C Part II - October Employment and active coverage end 10/25/15 COBRA coverage offered and elected immediately upon termination No offer of coverage, because offer wasn t for every day () Employee not full-time for the month (2B) B 2D 2B

32 1095-C Part II - November Employment and active coverage ended 10/25/15 COBRA coverage was continued during November No offer of coverage, even though COBRA was offered () Employee not employed for the month () B 2D 2B

33 1095-C Part II - December Employment and active coverage ended 10/25/15 COBRA coverage was terminated December 1 No offer of coverage, even though COBRA was offered () Employee not employed for the month () B 2D 2B

34 1095-C Part II Additional Points Non-Calendar year transition relief January through June were the 2014 plan year for this employer Row 14 & 15 unaffected Row 16 Non-calendar year transition relief (2I) B 2D 2B

35 1095-C Part II Additional Points Non-Calendar year transition relief January through June were the 2014 plan year for this employer Row 14 & 15 unaffected Row 16 Non-calendar year transition relief (2I) I 2I 2I 2I 2B

36 1095-C Part II Additional Points COBRA never reported as offer of coverage to a terminated employee COBRA coverage offered to an active employee (due to reduction in hours) would be reported in the same manner and codes as any other offer to an active employee I 2I 2I 2I 2B

37 1095-C Part II Additional Points If an employee terminates employment on any day other than the last day of a month and the coverage or offer of coverage expires upon termination of employment, No offer of coverage, on line 14 If employer extends coverage until end of month (1G & in this example) 1G is an offer to a non-full-time employee (since not full time for complete month) 07 1G I 2I 2I 2I

38 1095-C Part III Self-Funded Plans Only Must be completed for anyone (whether employed or not) who is enrolled in coverage for at least 1 day in each month This accomplishes Section 6055 reporting (completed by insurance carrier for fullyinsured plans) X Tom Complicated Susan Complicated Billy Complicated X X X X X X X X X X X X

39 Tom Complicated North Ave Hometown PA Acme, Inc Main Street (555) Anytown PA I 2I 2I 2I 2B X Tom Complicated Susan Complicated X X X X X X X X X Billy Complicated X X X Copyright 2015, Hartman Employee Benefits, Inc.

40 Information for 1094-C Part I Part I - ALE Member (Employer) Info Employer name, EIN, address, name of contact, phone Designated Government Entity (DGE) only applies to one government entity filing for another governmental unit Total number of 1095-C submitted with this transmittal Authoritative Transmittal (line 19) Must be only one per ALE Member (Employer) If no, sign, but leave rest of form blank For example, Corporation XYZ has two separate operating divisions, Division A and Division B. XYZ may file separate Forms 1094-C for Division A and Division B, but must designate one of them as the authoritative transmittal reporting combined employer-level data including both divisions If yes, complete parts II, III, and IV, to the extent applicable

41 Information for 1094-C Part II Part II - ALE Member Info Total number of 1095-C Forms filed by and/or on behalf of ALE Member Should match line 18 unless there were other non-authoritative transmittals Member of an Aggregated ALE Group Certifications of Eligibility (See instructions) May result in alternative methods for simplified reporting if: Qualifying Offer Method (for one or more employees for all 12 months) Qualifying Offer Method Transition Relief (for 95% or more FT employees) Section 4980H Transition Relief (ALE <100 or penalty calculation 80) 98% Offer Method (MV & affordable to 98% of FT) Signature

42 Information for 1094-C Part III & IV Part III - ALE Member Info MEC offered to at least 95% of employees and children (yes/no) 70% for 2015 FT employee count (exclude EEs in limited non-assessment period) Skip if eligible for 98% offer method Total employee count (all employees FT & PT) Aggregated group (yes/no) Section 4980H transition relief indicator (enter code A or B 100+) Part IV Other ALE Members of Aggregated ALE Group Name & EIN

43 A Case Study for 1094-C Jane Doe is the HR Director for Acme, Inc. Acme, Inc. had 60 employees during 2015 All are full time and received a timely offer of coverage Acme, Inc. owns 100% of Subsidiary, Inc. The FTE count of the controlled group was 59, qualifying for 4980H transition relief for FTEs Acme, Inc. s health plan renews July 1

44 Acme, Inc Main Street Anytown PA Jane Doe (555) X X 60 X X Jane Doe HR Director 01/15/2016 Copyright 2015, Hartman Employee Benefits, Inc.

45 X X Copyright 2015, Hartman Employee Benefits, Inc. A A A A A A

46 Subsidiary, Inc Copyright 2015, Hartman Employee Benefits, Inc.

47 Questions? Contact: Rich Wilber Hartman Employee Benefits 1051 Shiloh Road, State College, PA (814)