Wall Street may be having a tough start to 2016, but employers recently got a New Year’s surprise from Uncle Sam. On December 28, 2015, the IRS issued Notice 2016-4, extending the deadlines for some of the 2015 reporting requirements under the ever-evolving Affordable Care Act (ACA).
Here are the basics of the Notice:
- The deadline for furnishing employees and individuals with the 2015 Form1095-C (Employer-Provided Health Insurance Offer and Coverage) or Form 1095-B (Health Coverage), whichever is applicable, has been extended from February 1, 2016 to March 31, 2016.
- The deadline for filing Form1095-C (with transmittal Form 1094-C) or Form 1095-B (with transmittal form 1094-B) with the IRS has been extended from February 29, 2016 to May 31, 2016 if filing by paper, and from March 31, 2016 to June 30, 2016 if filing electronically.
Who does the Notice affect?
The deadline extensions apply to:
- Applicable large employers that are required to furnish employees with forms and file those forms with the IRS under Code Section 6056 reporting requirements
- Health insurers
- Employers that sponsor self-insured health plans
- Others who provide Minimum Essential Coverage (MEC) and are required to furnish individuals with forms and file those forms with the IRS under Code Section 6055 reporting requirements
A welcome reprieve
The ACA has brought a flurry of new regulations and reporting requirements over the past few years, and the frequent changes and growing pains involved in its implementation have kept employers on their toes. And the fact that instructions for filing the reporting forms weren’t released until late in 2015 has only added to the logistical challenges. So these new reporting deadline extensions are giving employers some very welcome breathing room.
Will employers be subject to penalties for late filing?
Yes. If you fail to comply with the new extended due dates, you’ll still be subject to penalties under Code Sections 6722 or 6721 for failing to timely furnish and file. But even if you can’t meet the new deadlines, you should still furnish and file the forms as soon as possible after the deadline, because doing so could reduce your penalty. The IRS plans to take a good-faith enforcement approach during this first year of reporting, and it will consider whether employers or other coverage providers have made reasonable efforts to prepare for the furnishing and reporting requirements, as well as what employers have done to make sure they’ll be able to comply with 2016 reporting requirements.
If you already submitted an extension request, do you get even more time to file?
No. The new due dates announced in the Notice supersede all other deadlines. If you’ve already submitted an extension request, you won’t be getting a reply from the IRS, and you aren’t eligible for additional time extensions beyond the new due dates announced in the Notice. In fact, the whole process for requesting or applying for deadline extensions for the 2015 calendar year is going away. And keep in mind, these extensions only apply to 2015; you’ll need to be prepared to file as normal in January 2017 for calendar year 2016.
File early, beat the rush
Just because you’ve been given an extended deadline doesn’t mean you should procrastinate. The IRS is ready to accept filings now, and they encourage employers to file as soon as they’re ready.
Need to talk to a professional about ACA reporting requirements? Higginbotham can help.