Employer Reporting of Health Coverage – Code Sections 6055 & 6056

Posted March 04, 2015

The Affordable Care Act (ACA) created new reporting requirements under Internal Revenue Code (Code) Sections 6055 and 6056. Under these new reporting rules, certain employers must provide information to the IRS about the health plan coverage they offer (or do not offer) to their employees. The additional reporting is intended to promote transparency with respect to health plan coverage and costs. It will also provide the government with information to administer other ACA mandates, such as the large employer shared responsibility penalty and the individual mandate.

On March 5, 2014, the Internal Revenue Service (IRS) released two final rules on these reporting requirements, which apply for calendar years beginning after December 31, 2014. This date reflects a one-year delay provided in IRS Notice 2013-45. However, the IRS is encouraging voluntary compliance for 2014. The IRS also released Q&As on Section 6055 and Q&As on Section 6056.

Also, on February 8, 2015, the IRS released final versions of forms and instructions that employers will use to report under Sections 6055 and 6056 for 2014. These forms are not required to be filed for 2014, but reporting entities may voluntarily file them in 2015 for 2014 coverage. Forms and instructions for 2015 reporting have not yet been released and may contain some changes from these 2014 versions.

Effective Date

The Code Sections 6055 and 6056 reporting requirements were set to take effect in 2014. However, on July 2, 2013, the Treasury announced that employers will have an additional year to comply with these health plan reporting requirements. Thus, the Code Sections 6055 and 6056 reporting requirements will become effective in 2015. The first returns will be due in 2016 for coverage provided in 2015.

On July 9, 2013, the IRS issued Notice 2013-45 to provide transition relief for 2014 for Code Sections 6055 and 6056. Under the transition relief, employers are encouraged to voluntarily comply with the reporting requirements for 2014 (that is, by filing and furnishing Section 6056 returns and statements in early 2015). However, compliance is optional for 2014 and no penalties will be applied for failing to comply.

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Employer Reporting of Health Coverage – Code Sections 6055 and 6056

This Legislative Brief is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.