Summary
Two provisions of the Affordable Care Act apply only to applicable large employers (ALEs): the employer shared responsibility provision and the employer information reporting provision for offers of minimum essential coverage. In addition, self-insured ALEs – that is, employers who sponsor self-insured group health plans – have additional provider information reporting requirements.
Employers must determine their ALE status each calendar year based on the average size of your workforce during the prior year. Employers that had at least 50 full-time employees, including full-time equivalent employees, on average last year, are most likely an ALE for the current year.
What’s Trending for ALEs
IRS Updates and Expands Q&As for Employers
The IRS updated and expanded employer Q&As with more answers to employers’ questions about ACA information reporting requirements and shared responsibility provisions. See the ACA Tax Provisions Questions and Answers page for more information.
IRS Extends Due Date for Employers and Providers to Issue Health Coverage Forms to Individuals
On November 18, 2016, the IRS extended the 2017 due date for providing 2016 health coverage information forms to individuals. Insurers, self-insuring employers, other coverage providers, and applicable large employers now have until March 2, 2017 to provide Forms 1095-B or 1095-C to individuals, which is a 30-day extension from the original due date of January 31.
Notice 2016-70, also extends transition relief from certain penalties (IRC Sections 6721 and 6722) to providers and employers that can show that they have made good-faith efforts to comply with the information-reporting requirements for 2016 for incorrect or incomplete information reported on the return or statement. This Notice also provides guidance to individuals who, as a result of these extensions, might not receive a Form 1095-B or Form 1095-C by the time they file their 2016 tax returns.is also abating penalties for inadvertent errors and omissions where there was a good-faith effort to comply with the reporting requirements.
The due dates for filing 2016 information returns with the IRS remain unchanged for 2017. The 2017 due dates are February 28 for paper filers and March 31 for electronic filers.
Due to these extensions, individuals may not receive Forms 1095-B or 1095-C by the time they are ready to file their 2016 individual income tax return. While information on these forms may assist in preparing a return, the forms are not required to file. Taxpayers can prepare and file their returns using other information about their health insurance and do not have to wait for Forms 1095-B or 1095-C to file.
How to Determine if you are an ALE
If an employer has at least 50 full-time employees, including full-time equivalent employees, on average during the prior year, the employer is an ALE for the current calendar year. However, an employee will not be counted toward the 50-employee threshold for a month in which the employee has medical care through the military, including Tricare or Veterans’ coverage. For more details see this page.
Resources and Outreach Materials for Applicable Large Employers
Questions and Answers
- Employer Health Care Arrangements
- Employer Shared Responsibility
- Information Reporting by Employers on Form 1094-C and Form 1095-C
- Information Reporting by Health Coverage Providers (Section 6055)
- Information Reporting of Offers of Health Insurance Coverage by Employers (Section 6056)
- Reporting Value of Employer-provided Health coverage on Form W-2
Forms and Instructions for Applicable Large Employers
- Form 1094-C and Form 1094-C Instructions, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns
- Form 1095-C and Form 1095-C Instructions, Employer-Provided Health Insurance Offer and Coverage
Legal Guidance and Other Resources
Bookmark the ACA Legal Guidance and Resources page, where you can find the latest
- Health Care Tax Tips, Flyers, Publications, Trifolds and Additional Materials
- Social Media, YouTube Videos, Webinars and Podcasts
- News Releases and Fact Sheets
- ACA Filing Season Statistics
- Legal Guidance – Announcements, Regulations, Treasury Decisions, Notices, Revenue Procedures, and Revenue Rulings
General Information on ACA Tax Provisions for Employers
The Tax Provisions for Employers page provides guidance on the following topics that may affect applicable large employers, as well as other topics for all employers:
- Employer Shared Responsibility Provision – Section 4980H
- Information Reporting on Health Coverage by Employers –Section 6056
- Information Reporting on Health Coverage by Insurers – Section 6055 (applies to self-insured ALEs)
Employer Shared Responsibility Provision Estimator
The Employer Shared Responsibility Provision Estimator helps employers understand how the provision works and learn how the provision may apply to them.
ACA Information Returns (AIR) Program
ALEs that file 250 or more information returns with the IRS must file the returns electronically. For information on the communication procedures, transmission formats, business rules and validation procedures for returns transmitted electronically through the ACA Information Returns (AIR) program, see AIR User Guides & Publications.