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Compliance Update - October, 2020

ACA 1095 Compliance Update for TY2020

The IRS has just released their finalized 1094-B, 1094-C, 1095-B, and 1095-C instructions and tax forms for Tax Year 2020! There were quite a few changes this year, including an extended print & mail deadline, so please read carefully.

Extended Print & Mail Deadline: March 2nd, 2021

  • The IRS has extended the ACA printing & mailing deadline, for tax forms 1095-B & 1095-C, from February 1st, 2021 to March 2nd, 2021.
  • For more information, please see IRS Notice 2020-76.
  • There is currently no automatic extension for the IRS filing requirement on March 1, 2021. Filers can still file Form 8809 on paper, or electronically, for a filing extension.
IRS Form 1095-B Updates:
  • Line 8 - New Coverage Code: A new code G must be entered on Form 1095-B, line 8 to identify an individual coverage HRA.
  • Individual Coverage Health Reimbursement Arrangement (HRA): For plan years beginning on or after January 1, 2020, employers may offer HRAs integrated with individual health insurance coverage or Medicare, subject to certain conditions (individual coverage HRAs). Generally, an HRA, including an individual coverage HRA, is a self-insured group health plan and, therefore, is an eligible employer-sponsored plan.
  • Relief Regarding Furnishing 1095-B Statements: The IRS has continued the policy that 1095-B tax forms do not need to be furnished to recipients as long as:
    • The reporting entity must post a notice prominently on its website stating that responsible individuals may receive a copy of their 2020 Form 1095-B upon request, accompanied by an email address and a physical address to which a request may be sent, as well as a telephone number that responsible individuals can use to contact the reporting entity with any questions.
    • The reporting entity must furnish a 2020 Form 1095-B to any responsible individual upon request within 30 days of the date the request is received.
    • NOTE: The reporting entity may furnish these statements electronically if it meets the requirements provided in 1.6055-2y. See here - for more information.
IRS Form 1095-C Updates:
  • Part II - Employees Age on January 1: If the employee was offered an individual overage HRA, enter the employee's age on January 1, 2020. Note that for non-calendar year plans or for employees who become eligible during the plan year, this age may not be the Applicable age used to determine Employee Required Contribution.
  • Line 14 Offer of Coverage - New Codes: Added new codes 1L, 1M, 1N, 1O, 1P, 1Q, 1R, & 1S.
  • Line 17 Zip Code: If the ALE Member used code 1L, 1M, 1N, 1O, 1P, or 1Q because it offered the employee an individual coverage HRA, enter the appropriate ZIP code used for identifying the lowest cost silver plan used to calculate the Employee Required Contribution in line 15. This will be the ZIP code of the employee's residence (code 1L, 1M, or 1N) or the ZIP code of the employee's primary site of employment if the ALE Member uses the work location safe harbor (code 1O, 1P, or 1Q).