If they haven’t done so already, sponsors of group health plans that are subject to the Affordable Care Act’s reporting requirements should act quickly to provide the required notices to participants and the IRS. The prompt correction of any late submissions can help reduce the likelihood of costly penalties.
Individual Returns – Forms 1095 B and 1095 C due March 1, 2024
In prior years, the IRS issued extensions of the January 31 deadline by which insurers and employers must provide the individual participant and employee returns (Forms 1095 B and 1095 C, respectively).
As we wrote last year, the IRS made the traditional deadline extension permanent in December 2022, meaning no additional extension is available for the deadline to provide individual returns. This year, insurers and employers were required to provide these individual returns to participants and employees by March 1, 2024.
Employers (or other plan sponsors) who missed the March 1 deadline should provide the individual returns as soon as possible. Corrections made within 30 days of the deadline will result in reduced penalty amounts, and corrections made after the 30-day deadline but before August 1 are subject to increased penalty amounts that are still less than the presumptive penalty amounts that would otherwise apply. Although the IRS no longer offers “good faith effort” relief, it may be possible to mitigate potential penalties if the employer can show the delay was due to reasonable cause and not willful neglect.
IRS Submission – Forms 1094 B and 1094 C due April 1, 2024
The IRS did not alter the deadline by which insurers and employers must file copies of the individual returns under cover of transmittal Forms 1094 B or 1094 C. Because March 31 falls on a Sunday this year, filers must complete this IRS submission by April 1, if filing electronically.
Notably this year, the IRS filing threshold for mandatory electronic reporting is reduced from 250 to 10 individual returns, meaning filers with 10 or more individual returns must file the IRS submission electronically. (Additionally, the reporting instructions provide that the IRS encourages all filers to file electronically.)
Filers requiring more time for the IRS submission must file Form 8809 before the deadline to receive an automatic 30-day extension.
This blog was drafted by Laura Fischer, an attorney in the Spencer Fane Denver, Colorado office. For more information, visit spencerfane.com.
