On November 18, the IRS issued a release that provides employers with an unexpected extension of time to comply with 2016 ACA reporting requirements. Although this deadline extension is not nearly as generous as the extension provided for 2015 reporting, it will undoubtedly be a welcome relief to employers.
Upon a finding that many employers would benefit from additional time to gather and prepare reporting data, the IRS granted an extension of time for the delivery of employee statements – either Form 1095-B or 1095-C. Under the original deadline, employers must provide these statements to employees by January 31, 2017. The newly-granted extension gives employers an extra 30 days to deliver these statements by extending the deadline from January 31 to March 2, 2017.
This extension applies only to the delivery of employee statements Form 1095-B or 1095-C. The original deadline for submissions to the IRS remains unchanged: February 28 for hard copy submissions or March 31 for electronic filings.
Also included in the release is an extension of the 2015 “good faith effort” exemption from filing penalties. Employers that make a good faith effort to timely distribute and file accurate reports will not be subject to penalties from the IRS. Importantly, this exemption applies to inaccurate taxpayer identification numbers, as well.
Applicable Large Employers and small employers that sponsor a self-funded health plan should continue to diligently prepare for 2016 ACA reporting. The extended deadline grants employers some flexibility in finalizing reports and distributing employee statements, but should not be viewed as a reason to further delay reporting preparations.
For more information on 2016 reporting requirements, view our on-demand webinar here or contact a member of our Compliance Team.