1095-C: Reporting Requirements: A Step-by-Step Guide

The Affordable Care ActReporting Requirements: A Step-by-Step Guide to Form 1095-C
1

These slides were last updated on October 26, 2016.
2

First things first, this is not a basic guide.
3

This guide assumes you know how the Employer Mandate
basically works under the Affordable Care Act.
4

Which brings me to a very important point. The reporting
requirements are their own separate, free-standing requirement
under the Affordable Care Act.
5

I’ve helped thousands of employers since the Affordable Care Act
was signed on March 23, 2010.
6

And not from some ivory tower or some talking-head booth, but
from working side by side with employers trying to figure this
thing out.
7

These slides were viewed over 100,000 times for the 2015 tax
year (with no help from the underlying material because IRS
regulations are where good times go to die).
8

I am updating these slides because many of you are repeat visitors
that have emailed me asking me where the 2016 slides are.
9

What is new for 2016? Lots of little things and a few big things
that we will tackle in due course.
10

I’ve written three editions of a comprehensive guide on the
Affordable Care Act called The Employer Mandate Handbook. The
third edition was released in September 2015 (and I am currently
working on the fourth edition for release in January 2017).
11

When I wrote my academic articles and books, I cited every legal
authority I could so people could verify my analysis.
12

I have been quoted in the Houston Chronicle, Forbes, and New
York Times.
13

I have spent years working on this stuff every day.
14

But even after all of that, I don’t know everything, and you should
run (very fast) from anyone that claims they do.
15

What I do know is that as far as the reporting requirements are
concerned, it is irrelevant whether you are offering insurance or
not during 2016.
16

If you are an Applicable Large Employer or Applicable Large
Employer Member during 2016, you must comply with the
requirements that follow.
17

Again, it does not matter if you had fewer than 99 full-time
employees or their equivalent during 2015 or 2016.
18

It does not matter if you have a non-calendar year plan that has
not yet come up for renewal in 2016.
19

The only thing that matters is whether you are an Applicable
Large Employer or Applicable Large Employer Member during
2016.
20

If you do not know the answer to the last slide . . .
21

Stop.
Investigate.
Then Come Back.
22

You might be wondering what is the ultimate goal of all of this
reporting.
24

These reports serve two ultimate functions:
26

The IRS has to keep track of two groups of people:
27

Under the Individual Mandate, the IRS has to identify which
Americans have medical benefits and which do not. Those that do
not, and don’t have an authorized excuse, will pay a financial
penalty.
28

Under the Employer Mandate, the IRS has to identify whether
Applicable Large Employer Members offered health insurance, or
the right kind of health insurance, to full-time employees in
assessing fines for those employers.
29

Form 1095-C collects information to help the IRS enforce the
individual and employer mandates.
30

Form 1095-C has three parts.
31

The parts you complete as an employer depend on the type of
insurance coverage you offer (self-insured vs. fully insured) and
the employment relationship of the recipient of your offer of
coverage (employee vs. non-employee).
32

Some companies buy their health insurance from a carrier
(usually through a broker). This means the company’s health
insurance is fully-insured.
33

Other companies run, for lack of a better word, their own
insurance companies (called self-insured plans) and do not buy
insurance from an insurance company.
34

The IRS wants information from both employers and insurance
companies to help it enforce the employer and individual
mandates. Some employers are, essentially, both. That is why
self-insured employers have to go a bit further than fully-insured
employers with regard to these reporting requirements.
35

In order to complete and file the correct forms, you need to know
whether you have a fully insured or self-insured health plan.
36

If you do not know whether your company has a self-insured or
fully insured health plan for employees . . . .
37

Stop.
Investigate.
Then Come Back.
38

Now you should know: (1) whether your company is an ALEM,
and (2) whether it fully or self-insures its employee benefits.
40

The proper forms for your particular situation will appear on the
next three slides depending on your situation (both as an
employer and the individual receiving the Form 1095-C). Study
them carefully to ensure you pick up the right form and complete
the appropriate parts.
41

42
Employer Type Must File
Self-Insured
Applicable Large Employer Member
 Form 1095-C. Complete Parts I, II, and III for
each full-time employee. Fully complete only
Parts I and III for each non-full-time employee
covered under the self-insured plan (and only
complete Line 14 of Part II).
 Forms 1095-C must be filed with the IRS by
March 31 (if filing electronically).
 A copy of Form 1095-C must be furnished to
the individual full-time employee by January
31.

43
Fully-Insured
Applicable Large Employer Member
 Form 1095-C. Complete Parts I and II. This form
must be completed for each full-time employee.
 Forms 1095-C must be filed with the IRS by March
31 (if filing electronically).
 A copy of Form 1095-C must be furnished to the
individual full-time employee by January 31.

44
Self-Insured
Non-Applicable Large Employer Member
 Form 1095-B. Complete Parts I, II, III, and IV. This
form is completed for each employee covered under
the self-insured plan.
 Form 1094-B. Complete entire form. This form will
be used to transmit Form 1095-B to the IRS.
 Forms 1095-B and 1094-B must be filed by March
31 (if filed electronically).

What if my company is neither an ALEM nor is self-insured?
46

If you are a small company (less than 50 full-time employees or
their equivalent) that buys their insurance from a carrier
(typically through a broker), you have no reporting requirements.
48

The rest of you should know by now which forms you need to
complete based on your status and the status of the recipient.
49

So why would I update these slides in October? First, the final
instructions were released a few weeks ago. Second, I have hope
that people will learn from their mistakes and get an earlier start
this year. Many late-starters were contacting me—even with the
massive extensions last year—at the 11th hour.
50

The probability that the IRS is going to give another extension like
the one last year is nil in my opinion.
52

Form 1095-C must provided to employees by Jan. 31, 2017
54

You can get—probably at most—a 30-day extension on that
deadline by by doing this:
Send a letter that includes (a) filer name, (b) filer TIN, (c) filer
address, (d) type of return, (e) a statement that the extension
request is for providing statements to recipients, (f) reason for
delay, and (g) the signature of the filer or authorized agent to the
IRS. Your letter has to be in the mail by January 31, 2017.
55

But where do I send this letter to?
56

Attn: Extension of Time Coordinator,
240 Murall Drive, Mail Stop 4360,
Kearneysville, WV 25430.
57

Keep in mind that even if the IRS gives you an extension, your
employees will start to come around asking for their Form
1095-C in January because they need the information to
complete their own tax returns.
58

Practical Tip: If you are going to ask the IRS for an extension,
tell your employees as soon as possible so that they can plan
accordingly on their ends. Full-time employees expect to get
their forms in January.
59

There are two deadlines (just like in W-2 land). The first we
just talked about, the one for employees. The second we are
about to talk about, for the IRS.
60

61
Form 1095-C must be provided to the IRS by March 31, 2017
(filing electronically)
Form 1095-C must provided to the IRS by Feb. 28, 2017
(filing paper)

I am probably going to need an extension on that one too.
62

Now that you know about the deadlines, let’s talk about what
happens to you if you miss them.
64

Spoiler alert: it is not good.
65

Missing either the employee deadline or missing the electronic or
paper IRS deadlines will cost you a significant sum of money
(between $260-$520 per form).
66

Now you have the updated deadlines and the penalties for 2017.
67

One last point to orient you to what the heck we are up to here:
68

Form 1095-C is a close relative of Form W-2. Most of the same rules
apply to this “family” of documents (including the somewhat
burdensome electronic-receipt rules).
69

Instead of disclosing wages, compensation, and tips (like a W-2),
Form 1095-C discloses healthcare information including the kind
of insurance offered, if any, its price point to the employee, and
the moment at which it was offered, among other things.
70

Alright, enough background. Let’s get in there and get some
forms completed.
71

You can download Form 1095-C directly from the IRS here:
Form 1095-C
72

Always ensure you have the most up-to-date form by going
straight to the IRS website. Indeed, the IRS released different
versions of these forms while these slides have been online
(that’s why you should check back often as I update these slides
regularly as I receive email questions and the IRS releases new
guidance).
73

That’s right, resist the urge to print 200 of them and stuff them in
a drawer and just keep going back to the drawer—this happens, a
lot.
74

Ensure you have the correct form by checking the top-left corner
of the form in front of you.
75

78
The text inside the orange box is new for 2016. It seems that
many employees and tax preparers attached their Form 1095-Cs
to their tax returns.

80
If you make a mistake and want to correct it by sending in a
subsequent corrected form, you would check the “corrected” box.
Ensure you give the employee a corrected version as well.

81
The IRS clarified for 2016, that the VOID box, enclosed in orange
below, is not to be used by employers or employees. It’s an IRS-
only club.

Next, ensure you have the correct form version (especially in in
2017 because there are now two versions floating around—2015
and 2016). In 2017, you want the form that looks like the below
on the top-right corner.
82

It probably seems silly to have spent so much time on ensuring
that you have the correct form, but trust me, it’s an common
mistake.
83

Let’s move on to the substance of the form.
84

Part I, shown below, identifies the employee and the ALEM where
that employee works.
85

Pretty basic stuff. If you don’t know your employee’s name, you
have bigger problems than ACA compliance.
86

Pretty basic stuff again. If you don’t know your employee’s Social
Security Number, you have bigger problems than ACA compliance
(but as the whole TIN debacle shows, many employers don’t).
87

Practical Tip: The less you ask employees for private, sensitive
information like Social Security Numbers, the better off you are as
an employer. Social Security Numbers for this purpose should be
harvested from other employee files already on record with an
employer.
88

The important thing to keep an eye on for Line 3 is that it’s below
Line 1 and 2, not to the right. The Form should be completed 1-6
and then 7-13.
89

Remember, this is the employee’s address, not the company’s
address, or the physical location where the employee works)
90

You should be done now with the top-left side of Part I.
91

Now you are ready to move to the top-right portion of Part I.
92

This is the legal name of the particular legal entity where the
person on Line 1 works.
93

So for example, assume you have three legal entities in your
business: Office Inc., Delivery Inc., and Cleaning Inc., The name of
the overall business is Bob’s House of Widgets.
Line 7 is asking for one of those three legal entities (ALEMs), not
the overarching name of the company or the name people know
that company by.
Ensure you put the ALEM that employs the particular person for
which you are completing the Form 1095-C. In the example
above, if you are filling in Bob’s House of Widgets, you are doing it
wrong.
94

Next, you need to fill out your EIN on Line 8. Verify that the name
that appears on Line 8 here matches the name and EIN provided
on the corresponding Form 1094-C.
95

What do I do if I do not have an EIN? Can I use my Social Security
Number or some other number?
96

No. If you do not have an EIN number you need to go get one
because you cannot file this form without such a number.
97

Stop.
Investigate.
Then Come Back.
98

Line 9 seems simple enough. The problem arises when you have
corporate structures and multiple addresses.
100

You could either put the address of the branch, location, or site, or
you could put the corporate headquarters address.
101

Regardless of which address you end up reporting, ensure that the
address in Line 9 matches the employer address on the corresponding
Form 1094-C (another form that acts as a coversheet for the 1095-C, Like
a W-3 for a W-2).
102

I recommend that you put the telephone number of someone that
will promptly reply to any employee inquiry.
103

Again, just as in Line 9, ensure these items match on the
corresponding Form 1094-C.
104

Like in 2016, in 2017, this row is optional.
105

For the 2017 eager beavers out there though, you just put the two-
digit number for the month in which your plan starts. For
example, if your plan starts in November, you would enter 11 in
this box. If you have no plan, 00 is the ticket.
106

Lines 14 through 16: Welcome. To. The. Show.
107

Take a deep breath because here we go.
108

People get the most tripped up on Form 1095-C answering Lines
14-16. Keep the next slide in mind as you try to figure them out in
more detail in the slides that follow.
109

Line 14: What, if any, medical benefit did you offer the
employee?
Line 15: How much did that medical benefit cost the employee
if you are claiming it was a QHP (or fully compliant
insurance)?
Line 16: What did the employee do when you offered him/her
medical benefits or, what excuse did you have for not
offering the employee medical benefits.
110

Line 14 gives people lots of headaches because of its code
structure. The line is basically asking what kind, if any, of medical
benefit you offered the particular employee or non-employee.
111

Let me be emphatically clear: Line 14 only cares about what you
offered that employee. Not what they took, what you offered Billy
Bob in the next cubicle, or offered the CEO.
Line 14 does not care about your excuses.
So if you start a sentence with, “I didn’t offer insurance because
[blah] [blah] [blah].” Line 14 only cares about the fact that you
did not offer medical benefits. The blah blah blah part comes into
play on Line 16. But on Line 14, you would put that you did not
offer insurance.
112

At any rate, Line 14 gets tricky pretty fast because you can’t just
write in whatever your health plan is.
113

Instead, you have to review a series of riddles codes and identify
where you fall as an employer, where the individual recipient
falls, and where the medical benefits fall.
114

Many times this is where the flipping back and forth between the
instructions and the Form itself frustrates most people.
115

I have simplified the process.
116

117
Code Series 1 Use When: Type of Offer Cost
1A
Full Time Employee: MEC & MV EE Pays < $94/month
Spouse: MEC or More N/A
Dependent: MEC or More N/A
1B
Full Time Employee: MEC & MV N/A
Spouse: None N/A
Dependent: None N/A
1C
Spouse: None N/A
1D
Dependent: None N/A
1E

118
Code Series 1
Cont’d
Use When: Type of Offer Cost
1F
Full Time Employee: MEC N/A
Full Time Employee +
Spouse:
MEC N/A
Full Time Employee +
Dependent
MEC N/A
FTE + Dependent + Spouse MEC N/A
1G
Non-Employee: MEC or More N/A
Spouse: None N/A
Dependent: None N/A
1H
Employee: None N/A
Spouse: None N/A
Dependent: None N/A
1i Reserved (Ed. Note: Hurray! This problematic code section is gone in 2016).
1J
Employee: MEC & MV
N/A
Spouse: Conditional MEC or More N/A
Dependent: None
N/A
1K
Employee: MEC & MV N/A
Spouse: Conditional MEC or More N/A

The reporting on Line 14 requires employers to track offers made
to the particular employee being reported on in the Form 1095-C
you are completing.
119

So when you offer Billy Bob Plan A, but Lethargic Larry only gets
Plan B, on Billy Bob’s Form 1095-C you do not mention what you
offered Larry. Likewise, on Larry’s Form 1095-C, you do not
mention what you offered Billy Bob.
120

Every employer is different so there is a corresponding code for
virtually every situation. To make sense of my cheat sheets
though you do need to have a quick primer.
121

MEC & MV: The plan must provide minimum essential coverage
and minimum value. These plans are often called Bronze, Silver,
Gold, or Platinum. If you don’t know whether you are offering this
type of plan, this is what you do:
122

Step 1. Pick up a telephone.
Step 2. Call the person you buy your insurance from.
Step 3. Politely ask if the insurance they sold your company is at
least bronze under the Affordable Care Act.
Step 4. If they know the answer to the question, you are all set.
Step 5. Come back to these slides.
123

MEC & MEC or More: A MEC plan is a medical benefit plan that is
more limited than a MEC & MV plan. Some employers are offering
folks MECs, MECs or More, and MEC & MV, and everything in
between. Again, if you don’t know where your medical benefits
fall, you need to find out (go back to slide 123 for instructions).
124

Conditional MEC or More: This is new for the 2016 tax year. The
simplest way to explain what this is to give you the example of
when this is most likely to apply. For example, suppose an
employer goes to a full-time employee and says, “Look Billy Bob,
I’ll offer your wife coverage, but I know she is employed. I am
willing to cover her so long as her employer does not offer her
health insurance.” This is a conditional offer to Billy Bob’s
spouse. This new development means we need two new codes in
2017 for the 2016 tax year, 1J and 1K.
125

MEC, MEC or More, Conditional MEC, MEC & MV, still confused.
126

Alright, remember, this is not a basic guide about the ACA, I
warned you that I would assume you knew a little bit about
what we are talking about. But, I will say this: If avoiding
all penalties is your game, getting your insurance to qualify
as a QHP should be your aim.
127

Do I really have to learn all these codes?
128

No, not really. Most employers will use no more than two or
three. Once you know the ones that apply to your employer, you
should be OK moving forward, so long as you don’t make major
changes to your offerings.
129

So once you know the right offer code (thanks to the previous
slides), the next part is to figure out how long the employee has
had that particular offer during a calendar year.
130

If the employee had the same offer for all 12 months in the year,
then you just fill out the “All 12 Months” box with that code.
131

If the employee only had that offer for less than 12 months, you
have to fill out the form, month-by-month, with the appropriate
code.
132

Frequently Asked Question: Does someone in a lawful waiting
period qualify as having been offered insurance during a month
in which the employee was in a waiting period?
133

No.
Someone in a waiting period did not get an offer of coverage
because he/she were in a waiting period (remember, the reason
for not offering an employee medical benefit is irrelevant on Line
14).
134

Frequently Asked Question: I did not offer someone insurance
because they did not work for me during that particular month.
That means I don’t have to put 1H right?
135

Wrong.
Someone who did not work for me did not get an offer of coverage
because they did not work for me (remember, the reason for not
offering an employee insurance is irrelevant on Line 14).
136

You should get the point by now.
If your hypothetical contains the phrase, “I did not offer the
employee medical benefits” it will always be 1H regardless of the
reason for not offering the employee medical benefits.
137

Frequently Asked Question: I offered a full-time employee a QHP
but they turned me down because he or she had insurance with a
spouse. What do I put in Line 14?
138

“I offered a full-time employee insurance but they waived it
because they are on their spouse’s insurance . . .
Line 14 does not care about waivers, it only cares about what you
offered the full-time employee. Everything after the “but” is
irrelevant. So if you offered a full-time employee a QHP and at
least MEC to his or her dependents and spouse, you would put 1E
on Line 14.
139

You should get the point by now.
If your hypothetical contains the phrase, “I did offer the employee
insurance” it will always be something in the 1 series regardless
of whether the employee accepted the offered medical benefit.
140

If the most you offered a full-time employee was a MEC plan, you
don’t have to fill out Line 15 because the entire point of Line 15 is
verifying that a particular plan offered on Line 14 was a QHP.
141

If you do not claim to have offered a full-time employee a QHP, you
can leave Line 15 blank (i.e., 1F, 1G, or 1H appear on Line 14).
142

Conversely, if you do claim to have offered a full-time employee
a QHP, you must put something in Line 15, even if it is $0.00 (in
other words, you have 1B, 1C, 1D, 1E, 1J, or 1K on Line 14).
143

Line 15 only applies to full-time employees that the employer
claims was offered a QHP on Line 14.
144

If you entered 1A on Line 14, you must leave Line 15 blank (in
fact, it’s against the rules to complete it) for those months in
which you used one of those two codes.
145

If you entered 1G on Line 14, you also do not have to fill out Line
15 or Line 16 for those months in which you used that code.
146

Note: In the final 2016 instructions, the IRS clarified that if you
entered 1G on Line 14, it must be for all 12 months. If you find
yourself entering 1G for less than 12 months on Line 14, you are
doing it wrong.
147

Line 15 is for employers that claim to have offered a full-time
employee a QHP (defined earlier). In order to have offered a valid
QHP, employers may not have charged full-time employees above
a particular threshold. Line 15’s goal is assessing what a full-time
employee was charged for the claimed QHP to verify the medical
benefit offered as a QHP.
148

Mario, I have this NEED to complete Line 15. Why do I leave it
blank (or put $0.00) if I use 1A/1G? Please let me just stick a
number in there, it will make me feel better.
NO! Again, like I said in the last slide, the entire point of Line 15 is
determining whether a particular full-time employee was asked,
by you Mr. Employer, to pay more than 9.5% of their income.
1A has a built-in financial threshold (remember that whole $94?)
so by putting 1A on Line 14 you are actually killing two birds lines
with one stone code.
Likewise, 1G is for non-full-time employees. The IRS does not
care under 1095-C what non-full-time people paid, so, that’s why
you leave it blank.
149

Again, if you did not offer a QHP, or offered just a MEC, skinny, etc.,
plan, or are completing a Form 1095-C for a non-employee who
enrolled in your self-insured coverage, you do not have to
complete Line 15.
150

Line 15 is just like Line 14 insofar as if you charged a full-time
employee the same cost month after month, for all 12 months,
you can just fill out the first “All 12 Months” box. Otherwise, you
have to disclose how much you charged such employees every
month.
151

Also note what Line 15 is actually asking you to report. It is asking
for the employee share of the monthly premium for the lowest
cost, self-only minimum value coverage.
152

Some people sign up for family coverage and pay more in
premiums than people who just sign themselves up. Line 15 does
not care about families or dependents; it is only asking about the
self-only employee coverage cost.
153

Likewise, some employers offer employees a bronze, silver, gold,
and platinum plan.
154

Line 15 only cares about the lowest plan cost. So if you offer gold
and bronze, put bronze employee-only cost in there even if the
particular employee decided to go with the gold plan.
155

Line 15 only cares about the lowest plan cost. Some of you may
have a bronze plan as the lowest, others silver, others gold. The
lowest plan you offer, its price to the employee, for self-only
coverage, that’s what goes on Line 15.
156

Frequently Asked Question: What if my full-time employees pay
nothing?
157

1. Go You!
2. You put $0.00 on Line 15.
158

The basic point of Line 16 is to figure out what the employee did
once you offered coverage (accepted, rejected, etc.).
And if you did not offer, a reason why (for example, 2D has a
series of allowed reasons for not making offers of coverage to
otherwise eligible employees).
160

This is where most employers that tried to give an excuse on Line
14 should cross-check their excuse against the series codes and
enter them on Line 16 (waiting periods, non-employed
employees, etc.,)
161

For example, let’s say you hire a full-time employee in January
2016, but make them wait for two months during a waiting period.
For January and February you would put “2D” on line 16 for those
months (and 1H on Line 14).
162

Just like Line 14, there is a series of codes that apply depending
on several variables. I made it easy on you again.
163

164
Code Series 2 Use When:
2A Employee not employed during any day of the month.
2B
2B Scenario 1 2B Scenario 2
Recipient was not an employee, and
recipient did not enroll in coverage offered.
Termination/Separation month if health plan
does not cover employee for the rest of the
month.
2C Employee enrolled in health coverage offered every day of the month.
2D
Employee in Limited Non-Assessment Period:
• First Year As ALE – January through March
• Waiting Period under Monthly Measurement Period
• Waiting Period under Look-Back Measurement Period
• Initial Measurement and Administrative Period
• Period Following Change in Status
• First Calendar Month of Employment
2E Multiemployer Interim Rule Relief (Typically Union Plans)
2F Unaccepted Offer with W-2 Safe Harbor
2G Unaccepted Offer with Federal Poverty Guideline Safe Harbor
2H Unaccepted Offer with Rate of Pay Safe Harbor
2I Reserved (Removed by 2016 instructions from 2015 options)

Sometimes no code will apply and you will have to leave Line 16
blank. It’s better to leave it blank than to purposefully put
something that is wrong and get audited.
165

Indeed, some people got it pounded in them—not by me—to
always put 2C no matter what (“when in doubt, go with 2C”). This
was terrible advice and if you read the 2016 instructions carefully,
you can see that the IRS was rather annoyed by the 2C-or-Death
folks out there.
166

“Do not enter code 2C in line 16 for any month in which the
multiemployer interim rule relief applies (enter code 2E).
Do not enter code 2C in line 16 if code 1G is entered in line 14.
Do not enter code 2C in line 16 for any month in which a
terminated employee is enrolled in COBRA continuation
coverage or other post-employment coverage (enter code 2A).
Do not enter code 2C in line 16 for any month in which the
employee enrolled in coverage that was not minimum essential
coverage.”
Straight from the IRS folks.
167

On more time: Sometimes no code will apply and you will have to
leave Line 16 blank. It’s better to leave it blank than to purposefully
put something that is wrong and get audited.
168

So let’s talk about waivers again. One of the most emailed
questions is some variation of this: “I offered my full-time
employees great insurance at ACA-affordable prices but they
turned me down and went with their spouse’s insurance. What do
I do?”
Okay, we already talked earlier about what you do on Line 14. On
Line 16, what you put depends on which affordability safe harbor
you relied on (assuming you relied on one). So if your offer was
legally affordable, you put 2F, 2G, or 2H, depending on which you
used.
Someone that takes the insurance obviously gets 2C. And if the
person did not take your insurance and it was not legally
affordable (i.e., 2F, 2G, or 2H do not apply), you leave it blank.
169

If you buy your insurance coverage from a carrier / broker
You are done!
Now you just have to do this for every full-time employee your
ALEM employs.
170

If you self-insure your health benefits, you have to fill out Part III
which asks for information about covered individuals (not
necessarily employees) to satisfy the individual mandate.
171

Part III looks like this:
172
The language in the orange box above is new for 2016, and makes it
clear that you are to include the employee for which you are
completing the Form 1095-C in Part III. Many people were told to
only put dependents there.

But remember: Part III is for the individual mandate (the IRS is
tracking individuals) whereas Parts I and II are about the employer
mandate. If you leave the employee off of the individual mandate list
(Part III), how is the IRS supposed to know that the employee is
covered for the purposes of the individual mandate?
It can’t, which is why that language in the orange box was added in.
173

If you buy your insurance from a broker / carrier, insurance
companies have to provide this information to the IRS via a
separate form.
174

If you self-insure, you have to provide information for non-
employees. Otherwise, the IRS would not be able to keep track of
them without your help.
175

The first portion of Part III is for covered individuals (typically, the
employee, their spouse, and dependents, but it could also include
non-employees (COBRA-covered former employees, directors, and
retirees).
176

To the right, you will note that you are asked to either provide the
Social Security Number/TIN or the date of birth of the covered
individual. For covered individuals who are not the employee
listed on Line 1, you can use a Taxpayer Identification Number
instead of a Social Security Number. This was made explicit on the
new 2016 form with the addition of the text in the orange boxes.
177

And again, like with full-time employees, you will be asked to
verify whether the covered individual had coverage for all 12
months or if not, to break it up into a month-by-month report.
178

Importantly, unlike earlier in Part II, here if the covered individual
(the employee or a dependent) had coverage for one day, you can
report that they had coverage for the entire month.
179

Mario, I am freaking out right now because I do not know what is going on
with these reports!
181

I have another set of a bit more detailed slides (how is that possible,
right?) for sale ($7.50). Some of these slides are on that deck, but that
deck has several slides / visuals that are not here. This slide deck has 193
slides, that deck has 256 (that’s a lot more information). I also tackle
such timeless riddles like:
184

What is the difference between 1E / 1A?
Do I have to leave Line 16 blank if I put 1A in Line 14?
How do 1A and Line 22A on 1094-C interact?
How do I deal with COBRA employees?
And many more riddles that presently escape me.
185

Note: I tried my best to ensure that these slides are as accurate
and informative as possible. If I made a mistake, please send
corrections to my email address which appears in these slides.
186

Extra credit for those folks that send corrections with supporting
authority.
187

Comments and GENERAL questions should be sent to me via email
at the following email address: theACAguy@gmail.com. Also
email me to get added to my mailing list.
Please do not send me angry emails complaining about the ACA
itself. I can’t much do anything about that one. Also, please note
that sending me an email does not create an attorney-client
relationship nor is anything you send me privileged. I reserve the
right to quote your questions and my answers on my website,
slides, etc.
These slides are also copyrighted. © 2015-2017. All Rights
Reserved (please don’t steal my stuff).
188

Finally, I do not email these slides out to anyone. I provide these
for free here, and I want to keep it that way. I once went to a paid-
for seminar where someone had “borrowed” my slides and was
charging people for the privilege. Not cool and that’s why we can’t
have nice things. Please do not email me asking for copies of the
slides to be sent to you—I will delete your email and not even
respond (and not put you on my mailing list).
189

If you must absolutely have a copy of these slides because you
hate having to come back here, want to review them without
having to have access to the Internet, want more slides that go
into greater detail than those found here (on 1A and COBRA in
particular), then I heard you last year. As of this year—by popular
demand—you can buy the premium/downloadable version of
these slides and use them at your leisure (for the low, low price of
$7.50).
190

Think about it like this: If you hired someone to come explain this
to you at an hourly rate of $7.50, just above the federal minimum
wage, it would surely cost you more than $7.50. I get $2.50 for
every sale, and it goes straight to paying off the federal student
loans that I had to take out to put myself through college and law
school.
BUY THE SLIDES
191

ABOUT MARIO. Mario K. Castillo is the Vice Chancellor & General Counsel of the Lone Star College System, one of
the largest colleges in the United States, located in Houston, Texas and is Board Certified in Labor and Employment
Law by the Texas Board of Legal Specialization. Prior to joining the System, he was a labor, employment, and benefits
partner at the law firm of Monty & Ramirez LLP in Houston, Texas, where he helped employers avoid or minimize
liability and defended them when litigation was necessary. Mario also completed a four-year term as briefing
attorney to the Honorable Felix Recio of the Southern District of Texas prior to joining Monty & Ramirez. Mario
received a Juris Doctorate from the Maurer School of Law at Indiana University—Bloomington. Prior to attending
law school, Mario received a Bachelor of Arts in Government from the University of Texas in Austin.
DISCLAIMER. This presentation is for informational purposes only and provides general information concerning
the Affordable Care Act to help you identify when you may need additional advice. It is not an exhaustive treatment of
the statutes, case law or regulations that are involved with the subject. Please recognize that the law is developing
rapidly in this area and you will want to obtain current legal advice on your specific situation before taking action.
192

1095-C: Reporting Requirements: A Step-by-Step Guide

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1095-C: Reporting Requirements: A Step-by-Step Guide