The IRS and the U.S. Department of the Treasury have announced a limited extension of the early 2016 due dates for 2015 information reporting requirements under the Affordable Care Act (ACA) for employers and insurers. Up until now, employers and insurers have not been required to report certain information about health coverage to employees, other individuals, and the IRS, so this extension serves to ease the new burden presented to providers.

What does the notice extend?

The notice extends the February 1st due date for employers and insurers to provide individuals with forms (reporting offers of health coverage and coverage provided) by two months (due March 31, 2016).

When is reporting due to the IRS?

Normally year-end 2015, paper or electronic forms are due to the IRS by February 29, 2016 and March 31, 2016 (respectively), but this notice extends the IRS due date by three months.

When should employers begin reporting?

The IRS is ready to begin accepting this reporting in January. Response from stakeholders led to this extension, so the IRS hopes that employers and insurers will have adequate time to provide this reporting, but applicable parties are urged to begin reporting to employees as soon as possible.

Will many taxpayers be affected by the extension?

The extension will likely not affect the majority of individual taxpayers. Most individuals will only have to check a box on their return showing their health coverage for the full year, and are not required to attach forms to their returns.

To those that will be affected by the extension, the notice does provide guidance, like:

• Individuals who file their tax returns depending on other information about their health care do not need to amend their returns.
• The IRS’s ability to use the information provided to verify compliance will not be materially affected by the added time.

This extension aims to assist minimum essential coverage providers in the process of implementing new systems and procedures in this first year, by giving them the proper time to do so. Nonetheless, it is important for employers and insurers to comply as soon as they are able. March 31st will certainly sneak up on us!

Questions? Contact us.