The IRS has released final
regulations addressing certain reporting and disclosure requirements
under the Patient Protection and Affordable Care Act
("PPACA") that are applicable to employers who offer
self-insured health coverage to employees.
PPACA has added significant new reporting requirements to the
Internal Revenue Code which enable the IRS to enforce the employer
and individual mandates (i.e., the "play-or-pay"
provisions) and to administer the premium tax credit. Specifically,
Code Section 6055 requires insurers of insured health plans and
sponsors of self-funded health plans to file annual information
reports with the IRS.
Insurers, and employers
sponsoring self-funded health plans, must also furnish an annual
statement to individuals enrolled in their plans. This information
will be used to determine whether employees qualify for a premium tax
credit for coverage purchased through an Exchange.
Requirements. The specific information
required to be reported by employers under Section 6055 includes:
- information about the employer offering coverage,
including contact information;
- the name and Taxpayer Identification Number
("TIN") of each individual enrolled in the plan; and
- the months for which the individual was covered.
An individual's birthdate
may be used in place of a TIN if, after reasonable efforts, the
employer cannot obtain the TIN from the individual.
Permitted. The final regulations
provide for a single consolidated form that employers can use to
report to the IRS and employees under Code Sections 6055 and 6056 and
thereby avoid duplicative reporting. (See the 3/13/2014 Alert for
information on the Section 6056 reporting requirements.) The combined
form will have two sections: the top half for Section 6056 reporting,
and the bottom half for Section 6055 reporting.
Employers subject to
PPACA's shared responsibility provisions (i.e., employers with
50 or more full-time equivalent employees) and who self-insure will
complete both the top and bottom portions of the form. Employers that
provide health coverage via insurance contracts will complete only
the top half of the form.
Effective Date. The Section 6055 reporting requirements are effective
for coverage provided on or after January 1, 2015, with the first
information return to be filed with the IRS and provided to
individuals in early 2016.