Tick-tock: Why Form 1095-C can be complex -- and time-consuming

In the weeks ahead, employees in company-offered health plans will begin to receive IRS Form 1095-C, which documents whether individuals were offered health insurance through their jobs. Per IRS rules, every employee for a company filing Forms 1094-1095 must receive a copy of Form 1095. The same goes for an employee's spouse and dependants if offered health coverage. As a general rule, firms with at least 50 full-time employees must offer health insurance to these workers and file IRS Forms 1094-1095 to show compliance (or non-compliance) with the Affordable Care Act. However, smaller separate companies under common ownership may also have to file Forms 1094-1095, even if the firm didn't have 50 full-time employees the previous year.

On average, per IRS guidance, Form 1095-C takes 12 minutes to complete. And with one form due for each employee, you can see where this begins to add up from a time perspective for larger groups. Using this math, a company with a 100-person group might need 20 hours to finish Forms 1095.

Estimates are estimates, and some companies might be able to whip through ACA reporting without much trouble. However, there are definitely some details to wade through on the path to compliance.

In "The Perfect Storm," The Plexus Groupe's eBook on the complexities of Affordable Care Act compliance, we discussed how Line 14 of Form 1095-C -- the line that declares whether an employee took coverage -- requires employers to sort through 11 different choices, all with separate codes. That's just one line, but it gets into the crux of ACA IRS reporting: there is definitely a time cost when it comes to preparing the forms.

Can employers go it alone for IRS ACA reporting? Of course. For some firms, it is the right time, resource and compliance choice.

But for other firms, 1094-1095 filing and preparation might be best completed with a partner who can handle the distribution of forms to employees and the all-important testing / auditing of forms and data before transmittal to the IRS.

The Plexus Groupe provides filing, consulting and preparation services for IRS Forms 1094 and 1095. Need help with just one part of the process or all steps, start to finish? No matter -- give us a call. We'll walk you through what it will take to get it done together. Contact us at 847.307.6100 (Chicago/suburbs), 312-606-4800 (Chicago/Loop) 972-770-5010 (Dallas) or 405-840-3033 (Oklahoma City) to speak to a Plexus client executive, or contact us via the Web.

Finally, for even more on Forms 1094-1095, check out Plexus's eBook on IRS ACA compliance. Click here to be redirected to our homepage, and fill out the short, three-line form in the middle of the page to download. We're here to help -- and we're happy to help.