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Late on Filing Health Insurance Coverage Forms? IRS Notices Require Prompt Action

Sikich

Aug 3 2017

3 min read

The IRS recently released notices to Applicable Large Employers (ALE) who have failed to deliver employee statements to their staff and file them with the IRS. The IRS-issued notices address health insurance coverage employee statement Form 1095-C and transmittal Form 1094-C from the years 2015 and 2016.

Action and Compliance Required

Forms 1095-C and 1094-C are mandatory for large employers to complete, under policies set by the Affordable Care Act (ACA). In fact, organizations that decline to comply with this regulation potentially risk suffering monetary penalty charges reaching up to $3 million. The notice, sent by the IRS, asks employers to state whether they have delivered Form 1095-C and filed Form 1094-C. If managers have failed to do so, they are prompted to provide a reason for their lack of action.

ALEs that have received a notice, otherwise known as Letter 5699 or the “Request for Employer Reporting of Offers of Health Insurance Coverage,” are expected to promptly submit the notice within 30 days of receiving it.

30 Days for Letter 5699 Responses

We suggest that large employers seek out benefits advisors for assistance, as the letter must be accurately completed within 30 days. ALEs and their advisors can also contact the IRS to ask for extended time to review their employee statement forms. Given the employer has a valid reason, the IRS may grant an extension.

On Letter 5699, employers must select one of five responses, which are presented as check boxes. Individuals can choose to answer that they have: (1) already completed and filed the forms, or (2) that they will file the forms and attach them within the IRS-issued letter. Other options include: (3) employers may answer that they will file their statements within a 90-day period, so long as they have reason for this delay; (4) the employer does not qualify as an ALE; or (5) employers can denote “other,” in which they must provide reasoning for stating so.

What’s Next

While at this point it is unsure whether the ACA will face another vote on its repeal, it is unlikely that a policy requiring employers to file employee statement forms would be revoked with it. It is important for ALEs to comply with current reporting regulations, for the sake of their employees and the company.

Contact your Sikich representative for help with Letter 5699 and Forms 1095-C and 1094-C. Our advisory team is readily available to assist you with any questions regarding addressing responses, requesting extensions, and filing appropriate forms.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

About the Author

Sikich

Sikich is a global company specializing in technology-enabled professional services. With more than 1,900 employees, Sikich draws on a diverse portfolio of technology solutions to deliver transformative digital strategies and ranks as one of the largest CPA firms in the United States. From corporations and not-for-profits to state and local governments and federal agencies, Sikich clients utilize a broad spectrum of services* and products to help them improve performance and achieve long-term, strategic goals. *Securities offered through Sikich Corporate Finance LLC, member FINRA/SIPC. Investment advisory services offered through Sikich Financial, an SEC Registered Investment Advisor. 