Employee Benefits Compliance

2021 Affordable Care Act (ACA) Reporting Forms 1094/95 Released – Changes Related to Individual Coverage Health Reimbursement Arrangements

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The Internal Revenue Service (IRS) just released final reporting forms and instructions for the 2021 Affordable Care Act (ACA) reporting year. Applicable Large Employers (50+ employees) must report annually to the IRS about the health coverage offered to full-time employees. Changes to the reporting forms include –

  • 2 new codes for Individual Coverage Health Reimbursement Arrangement (ICHRA) (see link for prior Leavitt Group article on ICHRA rules) offered to an employee with coverage for the spouse but not dependents.
    • 1T – Individual coverage HRA (ICHRA) offered to employee and spouse (not dependents) with affordability determined using employees primary residence zip code.
    • 1U – Same as 1T except for the use of employees primary employment site zip code affordability safe harbor.
  • No automatic extension this year. Must furnish these statements to individuals by January 31, 2022.
  • Removed penalty relief for reporting incomplete or incorrect information if filing made in good-faith. Meaning, penalties can be expected to lobbied on ALEs failing to report appropriately.
    • Penalty may be waived if failure was due to reasonable cause and not willful neglect.
    • Penalty remains at $280/statement not to exceed $3,426,000.

Provided by carrier/Exchanges and some small self-funded plansB Form Instructions      Form 1094-B      Form 1095-B

Provided by ALEC Form Instructions     Form 1094-C         Form 1095-C

What’s Next?

If you are an ALE, you should begin preparing for reporting now in order to make the reporting deadline of January 31st (to individuals) and March 21, 2022 (electronic filers) or February 28, 2022 (paper) (for the IRS). For more information on ACA reporting, see the IRS website. Contact your Leavitt Group representative for the ACA reporting form indicator code cheat sheet that can assist employers subject to ACA reporting with understanding the codes used to report the coverage provided to their full-time employees. Need help with reporting? Leavitt Group has resources for you to assist you with reporting. Be sure to ask your Leavitt Group representative!

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