A plan sponsor organization is asking the Trump administration for immediate relief from the Affordable Care Act’s (ACA) employer reporting requirements.
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“This administration has the opportunity to take action to help reduce the excess burdens imposed by the ACA’s reporting requirements (Code sections 6055 and 6056) and the employer mandate (Code Section 4980H),” the American Benefits Council (ABC) stated in a February 7 letter to Andrew Bremberg, Director of the White House Domestic Policy Council.
Meeting the ACA’s employer mandate, and especially submitting the Forms 1094-B, 1095-B, 1094-C, and 1095-C required by the Internal Revenue Service (IRS), have been and continue to be “difficult and costly for employers,” ABC noted. “This is, in part, due to the complexity of the forms that need to be provided to employees and filed with the IRS, as well as the need to modify benefit and payroll systems and to coordinate with third party record keepers and return preparers.”
ABC is hoping that Congress will repeal the employer mandate and the related reporting obligations, but in the interim, “the Council requests the Domestic Policy Council, and all appropriate executive branch agencies, use their authority and all the tools at their disposal” to minimize the current reporting burdens. The group cited the January 20 Executive Order in which Trump instructed agencies to “waive, defer, grant exemptions from, or delay the implementation” of ACA provisions that impose fees or other burdens on a range of stakeholders.
Specifically, ABC asked for relief, such as a safe harbor from enforcement, from obligations or penalties regarding tax years 2015-2017 (and maybe later) such as:
- The employer shared responsibility provisions of Section 4980H;
- The Section 6055 reporting requirements that apply to insurers, self-insuring employers, and certain other providers of health coverage; and
- The information reporting requirements that Section 6056 imposes on large employers.
As precedent for such relief, ABC cited IRS Notice 2013-45, in which the agency delayed enforcement of the employer mandate and allowed for voluntary information reporting for 2014.
If the administration sees a need to have some kind of reporting continue while congressional action is pending, ABC said insurers and employers should be allowed to comply voluntarily. “However, under no circumstances should any penalties be applied for failure to comply with the information reporting provisions with respect to calendar years 2015, 2016 and 2017,” ABC stated.
This relief should not cause problems for employees, because the IRS could simply allow them to rely on information besides the Form 1095-C to determine their eligibility for a premium tax credit, ABC added.
Filing under Code Sections 6055 and 6056 is required to determine compliance with the individual and employer mandates, respectively. Section 6055 requires health insurers and sponsors of self-insured health plans to report on the type and period of coverage. Section 6056 requires applicable large employers (ALEs) to provide information about whether minimum essential coverage is offered to their full-time employees and their dependents.
Currently, 1095-B and –C reports must be submitted to individuals by March 2, and submittals to the IRS are due February 28 (March 31 if submitting electronically). ALE members must use the C-series to comply with Section 6056 (Form 1095-C to the individual, and the 1094-C and 1095-C to the IRS). A self-funded employer that is not an ALE member is subject only to Section 6055 and should use the B series instead.
 David A. Slaughter, JD, is a Senior Legal Editor for BLR’s Thompson HR products, focusing on benefits compliance. Before coming to BLR, he served as editor of Thompson Information Services’ (TIS) HIPAA guides, along with other writing and editing duties related to TIS’ HR/benefits offerings. Mr. Slaughter received his law degree from the University of Virginia and his B.A. from Dartmouth College. He is an associate member of the Virginia State Bar.
Questions? Comments? Contact David at dslaughter@blr.com for more information on this topic |