According to the ACA (Affordable Care Act), most Americans are required to possess health insurance otherwise they may be subject to a tax penalty. Employers are responsible for providing their employees, working a minimum of 30 hours per week, with health insurance coverage. IRS Form 1095-C is used to verify that an employee is eligible to enroll in a health insurance plan sponsored by their employer. Over 60% of U.S. employees are currently insured through employer-based coverage.
Employer-provided health insurance is the largest tax expenditure in the U.S. In 2017, it cost the U.S. government over $260 billion in payroll taxes and lost income. Regardless of the system being so expensive, the law is still in effect. To avoid penalties, file IRS Form 1095-C to the Internal Revenue Service on time
Who Files IRS Form 1095-C?
IRS Form 1095-C is officially known as the Employer-Provided Health Insurance Offer and Coverage. It must be completed by an Applicable Large Employer for each full-time employee. You may qualify as an Applicable Large Employer if you have 50 or more full-time employees. If you are not qualified as an ALE, you are not eligible to provide your employees with health insurance plans. A copy of the completed form must be sent to an employee.
What is IRS Form 1095-C Used for?
An employer must use Form 1095-C to provide their employees with health care coverage information, including instruction on how they may enroll. With this form, an employer provides the IRS with summary information about all insurance offers made to their employees. When considering Form 1095-C, the IRS determines whether an employer owes any payments to the U.S. government.
How to Complete IRS Form 1095-C?
This form itself is a single page and is made up of three parts. The first part is divided into two sections. Section 1 must be filled by a recipient (employee), where they indicate their name, social security number and address. An employer must provide such information as their name, employer identification number, address, and contact telephone number. The second part of IRS Form 1095-C is called the Employee Offer of Coverage, where the conditions of the insurance plan along with the employee’s required contributions must be indicated. In the third part, all covered individuals should be listed according to their names, social security or taxpayer identification numbers, and months of coverage. When you file IRS Form 1095-C, do not attach it to your tax return.
What is the Deadline for Filing IRS Form 1095-C?
Employers must file this form to the IRS by January 31st, 2018.
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