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ACA Form 1094-C

Navigating the Affordable Care Act – 1094-C

Welcome back to the exciting and highly anticipated second installment of our “Navigating the Affordable Care Act” series. Today we are going to provide line-by-line instruction on how to properly fill out the ACA Form 1094-C, which as you may or may not remember from last week, as a company-wide information dump, similar to the W-3 forms.

IRS Form 1094-C can be found here

Part I – General Employer Info

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Part I is basic employer info including address, EIN, person to contact (whom to throw under the bus), etc. Part I is only tricky starting on Line 9 “Name of Designated Government Entity”. This line is only used if one governmental employer is reporting on behalf of another. So if the highway department of a larger city also reports on behalf of the parks department, which is a separate employer under the same government, this is where that distinction should be made. If you qualify to fill out Line 9, Lines 1-8 will be the entity being reported, Lines 9-16 will be the entity doing the reporting. If you are filing multiple 1094-C forms (probably on behalf of multiple entities), then you will fill out Line 18 to specify the total number of 1094-Cs in the total transmission.

If you are not one government employer reporting on behalf of another (the most likely and common scenario) you will simply fill out Lines 1-8 and call it a day on Part I.

Part II – ALE Member Information

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Part II is where things start to become a little hazy and confusing (sorry). Line 19 asks if this form is the Authoritative Transmittal for this ALE member, if you are submitting multiple batches of 1095-Cs (you have more than 250 to submit electronically) you will check this box if this is the Master form that summarizes all the forms submitted. If you check the box on Line 19, you must specify on Line 20 how many forms are being submitted (please note, and we will readdress this with the 1095-C, that each employee will account for a single form, regardless of how many pages were filled out on their behalf). In the event that an ALE is only submitting a single batch, then Line 19 would be checked, and Line 20 would be filled out.

Line 21 – Are you (as an ALE) a member of an aggregated group? The IRS definition of an aggregated group is long, boring, and borderline indecipherable (IRS Code – Title 26 – subtitle A – Chapter 1 – Subchapter D – Part I – Subpart B – Section 414 – Subsection b; go ahead look it up, I’ll wait).

Please believe me when I tell you it boils down to this: a group of inter-related entities will be treated as one employer (essentially subsidiaries that have the same EIN code).

If you are an aggregated group, check the box in line 21. Once you have completed your forms, you will submit them to the parent company, who will aggregate and file them on your behalf. If you are not a member of an aggregated group, good news! You do not have to complete Part IV of the 1094-C. If you are a subsidiary (or in the GPHA system, a Leased hospital) you will submit your forms to the parent company (GPHA) who will fill out Part IV on your behalf and file.

Line 22 – This line will probably be a one-year-only option. These boxes represent the various transition reliefs that the government has built into the ACA to help employers that are working towards compliance avoid penalties and fines this first year. There are a number of special circumstances for 2015 only that should ensure that anyone that is working towards compliance with this law, will not be fined, or will at the very least, minimize their fines to a “reasonable” number.

Box A – Qualifying Offer Method

Qualifying Offers are fantastic, they are the bee’s knees (as far as making these forms easier at least), and they also help you save some time filling out forms later on. They are however, harder to achieve than other offers. In the last post, we talked about safe harbors (methodology for determining affordability based around certain parameters or data). A Qualifying Offer (QO) is:

What is the benefit of Box A? Well on this form it isn’t a whole lot. On the 1095-C making a QO saves you some work, but for the 1094-C it doesn’t really remove anything. For any employee that received a QO, you can provide them a generic statement that says they do not qualify for any assistance on the exchange should they choose to shop for insurance there. If you are part of a self-funded plan, you must still provide them with a 1095-C however, so you don’t really save any time yet. But QOs are still fantastic, because you only have to do the math once/year. With the other safe harbors you have to do the affordability math for every employee, and do it frequently. By proving FPL affordability and making a QO you are saying “my plan is affordable for anyone that is legally considered to be full-time in the entire country; AND their spouse AND dependents are covered to boot.”

Box B – Qualifying Offer Method Transition Relief

If you made a QO to at least 95% of your full-time employees, for AT LEAST one month in 2015, you may check this box. It is meant as a grace period for plans that were not in effect, or were not compliant before their plan year started in 2015. The benefit of checking this box is that for any legally full-time employee that did not receive a QO for all 12 months, you may provide them with a generic statement that says they MAY qualify for subsidies or tax credits for Exchange-based insurance plans. This is not any sort of admission of guilt, or plea to be fined; this is just a company saying they are working towards compliance and an affordable insurance plan.

Box C – Section 4980H Transition Relief

The majority of ALEs are going to check this box. Check the instructions on page 12 of the 1094-C instructions, but more than likely, you will qualify.

If you have 50-99 Full-Time Equivalencies (FTEs), and you are able to check Box C, you are protected from any sledgehammer or tack hammer penalties for the 2015 calendar year. No fines, no penalties; as long as you qualify.

If you have 100+ FTEs you will (for 2015 only) qualify for Minus 80 relief. As I am sure you remember from every single previous ACA presentation in the history of history itself, the sledgehammer penalty ($2000 per non-covered employee for not offering insurance plan) allows you to (very kindly) subtract the first 30 FTEs from your penalty, and thus saves you some money (how very kind of the IRS, don’t you think?). For 2015, if you qualify and can check Box C, you will be allowed to subtract the first 80 FTEs from that penalty number, and save your company up to $100,000 (Like passing GO!).

Box D – 98% Offer Method

If you, as an employer, can certify that affordable, MV coverage was offered for ALL 12 months to AT LEAST 98% of employees for whom you are filing a 1095-C (using any of the safe harbors), you can check Box D. The benefit of this box is simple, if you can check it and do; you do not have to fill out column b in Part III on this form (FT Employee Count for each month).

Part III – ALE Member Information – Monthly

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Column A – Minimum Essential Coverage Offer Indicator

These columns help to determine whether an employer is eligible for the sledgehammer penalty. You check “yes” if you offered coverage to at least 95% of full-time employees AND dependents. If you didn’t, check no and brace thineself for the wrath of the IRS. For 2015 only, you may check yes if you offered coverage to 70%, rather than 95%, as a transitional relief for the first year.

Fiscal Year Transition Relief: if your plan was not compliant in 2015, but on the first day of your plan year that started in 2015 (i.e. July 1) your plan became compliant, you may still check this box.

Dependent Coverage Transition Relief: If you did not offer coverage to dependents in 2013 AND 2014, you do not have to have this coverage in effect in 2015; so long as you have “taken steps” to add this coverage to your 2016 plan. If you previously offered dependent coverage, you may not retract it.

Column B – Full-Time Employee Count

If you checked Box D in Part II do not do this column. For everyone else: this is where your numbers from either the look back or monthly measurement counting will come into play. Do NOT count employees in a Limited Non-Assessment Period (waiting, initial measurement, stability from previous measurement, administrative period, etc.). Do NOT count employees who are not LEGALLY considered full-time (at least 30 hours/week) but who are offered coverage out of generosity or policy.

Column C – Total Employee Count

You must count ALL employees every month. You may use one of the following days (but must use the same day every month).

Enter that number in Column C.

Column D – Aggregated Group Indicator

If you are a member of an aggregated group (subsidiary, affiliates filing under same tax ID, Leased Hospital) you are a member and you will check this box for the months you were considered such.

Column E – 4980 Transition Relief Indicator

If you qualified and checked Box C in Part II, you will specify what protection you are eligible for. If you qualify for the 50-99 FTE relief (and checked the proper box) you will put “A”

If you qualify for the Minus 80 relief (and checked the proper box) you will put “B”

If neither applies, and you didn’t check the box, you can leave this column blank.

Part IV – Other ALE Members of Aggregated ALE Group

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If you are a member of an aggregated group as previously defined. You will fill out the names and EINs of the other members of the group. If you are not a member of an aggregated group, you will leave Part IV blank.

And so concludes another page turning installment of our ACA series. As I know you can only handle so much excitement on a Monday, make sure to tune in next week for the 3rd chapter “1095-C: I hope you enjoy IRS Codes”

Have a great week, and email me with any questions.

 

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Aaron Miller is the HR/Marketing guy at GPHA. If you have questions on this or any HR topic, shoot him an email at amiller@gpha.com

Posted by Aaron Miller on May 4, 2015 in Affordable Care Act, Human Resources and Personnel Management.

 

3 thoughts on “ACA Form 1094-C”

  1. Roger john says:

    Nice job Aaron

  2. PAM STEVENS says:

    FILLING OUT 1094-c – AFTER LINE22D IT ASKS FOR IRS PIN NUMBER (I ASSUME BUSINESS ONLINE USER NUMBER) BUT THEN NEXT IT ASKS FOR “LINE NUMBER”? WHAT DO I PUT IN “LINE NUMBER”? THANKS.

    1. Aaron Miller says:

      Hey Pam,

      Sorry for the delay in responding. I’m not sure we’re on the same page. Box D for line 22 is the 98% offer method, but there should not be a space for an IRS pin number. Use this link to make sure you have the most up-to-date 1094-C: https://www.irs.gov/pub/irs-prior/f1094c–2015.pdf

      Thanks!

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