IRS delays 1095 reporting requirements for next year.

irs logo
On Friday, the IRS issued Notice 2016-70, which delays the deadlines for employers and health insurers to distribute Forms 1095-C and 1095-B to applicable employees.
With the delay, employee statements must be distributed by March 2, 2017 (previously January 31).  The deadlines for IRS transmittals (Forms 1094-C and 1094-B) were not delayed. Forms 1094-C and 1094-B must be submitted to the IRS by February 28 if in hardcopy and March 31 if in electronic format via AIR. As with last year’s reporting, copies of all 1095-Cs and 1095-Bs distributed to employees are included with the IRS submissions.

On Friday, November 18, 2016,  the IRS announced that the 1095-C and 1095-B form deadline for furnishing statements to employees will be extended to March 2, 2017.  The IRS maintained the deadline for electronically filing forms to the IRS by March 31, 2017.  Companies that have under 250 forms may mail the forms to the IRS, but the deadline will still be February 28, 2017. 

The IRS has also extended the “good faith effort” to reporting entities that have the ability to “show they have made good-faith efforts to comply with the information reporting requirements under sections 6055 and 6056… In determining good faith, the Service will take into account whether an employer or other coverage provider made reasonable efforts to prepare for reporting the required information to the Service and furnishing it to employees and covered individuals, such as gathering and transmitting the necessary data to an agent to prepare the data for submission to the Service, or testing its ability to transmit information to the Service. In addition, the Service will take into account the extent to which the employer or other coverage provider is taking steps to ensure that it will be able to comply with the reporting requirements for 2017.”

 The IRS also noted that, as a result of the extension, some individual taxpayers may not receive their 1095-C or 1095-B forms by the time they are ready to file their tax returns.  The IRS stated taxpayers may rely on information provided by employers or other coverage providers, similar to 2015 tax filing, for purposes of filing their returns.  Please feel free to use the following link for access to the entire IRS Release 2016-70.

Text of IRS Notice 2016-70: Extension of Due Date for Furnishing Statements and of Good-Faith Transition Relief under Sections 6721 and 6722 for Reporting Required by Sections 6055 and 6056 for 2016 (PDF)

Medcom is diligently working to ensure that the forms are still processed and mailed by January 31, 2017, for those clients who timely submitted data and provided approval to mail the forms. Since there is no extension for the electronic filing, we urge all clients to continue to provide data as if there was no extension.  However, if there are individual situations that arise where the extension would be beneficial,  your ACA Account Manager will be more than willing to discuss this with you.

Good faith, once again, relies on timely mailing and filing with the IRS.