IRS Offers Another Extension for 1094s and 1095s
A The IRS has, once again, come out with a holiday gift for employers. In the recently-released Notice 2019-63, the IRS provided additional reporting relief for employers for the 2019 calendar year. In short, the Notice provides:
The due date to provide Forms 1095-C or 1095-B to employees and individuals is extended 30 days from Friday, January 31, 2020 to Monday, March 2, 2020.
B Please note:
- This is a firm deadline. The IRS is not offering an additional 30-day extension beyond March 2, 2020.
- All requests for an additional 30-day extension will be denied (the IRS will not even respond).
C Is there relief for carriers providing coverage details?
- New for this year, the IRS is giving carriers (aka coverage providers) a limited “pass” with providing the 1095-B statements to individuals (whereas filing must still be made to the IRS).
- The 2019 ACA-individual mandate penalty remains zero ($0), and individuals do need to report whether they had coverage or not.
- Carriers that wish to qualify for this relief have to post a notice on their websites that the form is still available upon request, along with the promise that they provide the form within 30 days of each
D Does this relief apply to self-funded plans?
No. Employers with self-funded plans must still report about their FTEs (Full-Time-Employees) on Part III of Form 1095-C, and on Part IV of Form 1095-B.
E What if we cover folks other than FTEs?
Self-funded employers may take advantage of this relief if they are reporting on any employee who was not full-time for any part of 2019 (such as covered part-time employees, covered retirees, or COBRA QBs).
To take advantage of this relief, the self-funded employer would need to:
- Post a notice prominently on its website (vaguely described but not defined)that the forms are available on request; and
- Promise to respond to the request within 30 days.
- Generally, retirees and COBRA QB would not have access to an Employer’s website, so that may be defined further in subsequent guidance (but, savings from printing and mailing could be achieved).
- The extreme lateness of this guidance and the possible perceived value associated with doing less work (if you can reliably separate out these populations) may be outweighed even with an extension to March 2, 2020.
F Is there good news in this Notice?
- Good faith penalty relief is also extended for the 2019 forms.
- Employers/carriers who work in good faith to complete the forms will not be assessed penalties if there is missing or inaccurate information.
- The IRS takes the employer’s (or carrier’s) efforts with its good faith compliance – reasonable efforts to prepare the reports, efforts to gather and transmit the data to appropriate parties, etc.
- Employers should never file late with the IRS or miss the deadline to furnish forms to participants. The IRS expects timeliness but the “good faith relief” efforts permit compliance even if you aren’t perfect with your data.
G Final reminder about 1094-C deadlines:
- Smaller ALEs must file their paper forms with the IRS on/before February 28, 2020.
- ALEs with 250 or more employees must file electronically by March 31, 2020.
Please consult your 1094/1095 service providers about these deadlines (as deadlines outlined in your services agreement may not change). Finally, should you have any questions or comments, please reach out to your Account Executive or Account Manager.