IRS Announces 1095-B, 1095-C Deadline Extension for 2020 Furnishings
On Oct. 2, 2020, the IRS issued Notice 2020-76, which extended ACA reporting deadlines and requirements for Forms 1095-B and 1095-C. What does this notice say, and what do employers need to know?
What are Forms 1095-B and 1095-C?
The Affordable Care Act (ACA) requires employers with 50 or more full-time equivalent employees to offer healthcare coverage to full-time employees or potentially face a fine.
The government tracks this information using Form 1095-C, while Form 1094-C acts as a cover sheet for an organization’s collective 1095-Cs. Only applicable large employers (ALEs) are required to file these forms.
In order for employers to be considered an ALE, 50 full-time workers or full-time equivalents must be in employment on average during the prior year:
- Full-time Employee: 30+ hours per calendar week or 130+ hours per calendar month on average
- Full-time Equivalent (or FTE): Combination of two or more part-time workers whose hours are equivalent to a single full-time employee.
On the other hand, Form 1095-B is used by non-ALEs and indicates that taxpayers received minimum essential coverage (as defined by the ACA).
Why Did the IRS Extend the Furnishing Deadline for Forms 1095-B and 1095-C?
Much like in years past, the IRS announced this extension to provide employers with additional time to meet reporting requirements without risk of penalty. Before the announcement, Forms 1095-B and 1095-C were required to be furnished to employees by January 31, 2021.
Now, the furnishing deadline has been moved to March 2, 2021. The typical 30-day extension to furnish information statements will not be granted in addition to the new deadline.
Penalties for failure to furnish a Form 1095-B will not be assessed under the following circumstances:
- Reporting entities must post a prominent notice on their websites stating that responsible individuals can receive a copy of their 2020 Form 1095-B upon request, including contact information where the requests can be sent.
- Reporting entities must furnish Forms 1095-B to all responsible individuals upon request within 30 days of the request.
With this in mind, the adjusted date does not extend the filing deadline for 2020 Forms 1094-B, 1095-B, 1094-C, or 1095-C, all of which must be filed by Feb. 28, 2021, or e-filed by March 31, 2021.
What Other Deadlines Should HR Keep in Mind for 2021?
Regarding the 2020 filing, the IRS released early drafts of Forms 1094-C and 1095-C. While not yet finalized, these tax forms are expected to be released for use by employers in the coming weeks.
That said, there are additional compliance concerns that play key roles in all HR responsibilities. Stay on top of important dates and filing requirements using BerniePortal’s comprehensive HR calendar, which is updated regularly as extensions are granted and new deadlines are added.
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