The IRS recently released Notice 2018-94, which provides a 30-day extension to the deadline for Applicable Large Employers ("ALEs") to distribute the 2018 Affordable Care Act (ACA) reporting forms to employees and covered individuals. These Forms must now be provided to individuals by March 4, 2019, instead of January 31, 2019 and the IRS also confirms that additional 30-day extensions will not be granted. The IRS encourages employers and other coverage providers to furnish the Forms “as soon as they are able,” but can use the automatic extension if necessary. The extension is automatic; employers and other coverage providers need not apply for or specifically request it.
This notice also extends good faith transition relief from section 6721 and 6722 penalties to the 2018 information reporting requirements under sections 6055 and 6056. As in the prior filing periods, this notice confirms that this relief applies to missing and inaccurate information (i.e. taxpayer identification numbers, dates of birth, and other required information) required on the forms. No relief is provided where there has not been a good faith effort to comply with the reporting requirements, or where there has been a failure to file an information return or furnish a statement by the applicable due date.
How does this impact individuals filing their income tax returns?
The extension to provide Forms 1095-B and 1095-C to covered individuals may mean that some people will not receive their Forms 1095-B or 1095-C by the time they are ready to file their 2018 income tax return. Although the information contained on Forms 1095-B and 1095-C may be used by individuals to confirm that they had “minimum essential coverage” and to determine eligibility for a premium tax credit, the Forms are not required in order to file an individual income tax return. Consequently, taxpayers wanting to file returns early in the year may have to refer to other information about their health coverage for 2018 when completing their return.
What is not extended?
This extended deadline applies only to distributing the 2018 ACA reporting forms to employees and covered individuals and not to the deadline for filing the forms with the IRS. Notice 2018-94 does not extend the deadlines for ALEs to file the 2018 ACA reporting forms with the IRS. ALEs filing less than 250 returns may file in paper. The deadline for paper filing is February 28, 2019. ALEs filing 250 or more returns must file electronically through the IRS's AIR system. The deadline for electronic filing is April 1, 2019.
Reminder: For fully-insured group health plans, the insurance carrier is responsible for furnishing the Forms 1095-B to the IRS and employees, and the employer is responsible for furnishing Forms 1095-C to the IRS. For self-funded group health plans, the employer/sponsor is generally responsible for issuing and filing both Forms 1095-B and 1095-C.