For those keeping watch, the IRS has released the “Draft as of July 13, 2020” 1094 and 1095C Forms. While the 1094C has not been changed, the 1095C Form has several changes.
A quick reminder… whether an employer is an Applicable Large Employers (ALE) required to file Forms 1094/1095C is based on its FTE counts from the previous calendar year. With so much shakeup in the economy, many companies may be thinking that 1094/1095C reporting requirements no longer apply due to downsizing that may have occurred in the 2020 calendar year. While downsizing in 2020 may impact ALE status and reporting obligations for the 2021 calendar year, it will not impact reporting obligations for the 2020 calendar year.
The changes to the 1095C Form appear to be limited to Individual Coverage Health Reimbursement Arrangements (ICHRAs), which became available to employers as a means to reimburse employees for the costs associated with individual policies and Medicare for plan years beginning in January 2020. These changes include capturing the employee’s age on January 1 and zip code each month, as well as providing new Series 1 Offer of Coverage codes (1L – 1R) related to the type of ICHRA offered to an employee.
The forms are still in draft version, and we will publish additional information once the IRS releases instructions. ALEs who offered an ICHRA to any employees in 2020 should pay careful attention to these instructions when released as they will likely need to ensure they can meet any new reporting requirements.