Not a Moment Too Soon – IRS Issues FAQs on New ACA Reporting Requirements

Lyndsey Barnett

Over the past few months, I have worked with many frustrated employers as they were trying to get their systems and data ready to comply with the new ACA reporting requirements. In early 2016, all large employers and all self-funded employers are required to report information to the IRS to assist the IRS in assessing both the individual mandate penalties and the employer pay or play penalties. Many of the employers that I have been working with have been frustrated because there were so many unanswered questions in how to report certain data.

Yesterday, the IRS issued several sets of FAQs that provide additional details on how to comply with the reporting requirements. One set of FAQs provide additional guidance on completing Forms 1094 and 1095 C, which is the form that large employers must complete. Another set provides additional guidance for insurers and self-funded employers who are reporting on Forms 1094 and 1095 B. The IRS also updated its general FAQs on the reporting requirements. 

A quick read of the FAQs has already answered several of the open questions that we have been hoping to receive guidance on, including how to report coverage in the month an employee is terminated and how to report a COBRA beneficiary in a death or divorce. I haven’t digested all of the FAQs to the point of being able to say there are no unanswered questions, but I am happy that at least some of the open issues now have answers.