A Simple Step-by-Step Guide to Tax Filling Using ACA Forms

The Affordable Care Act demands that employers with 50 workers or more provide health insurance. Companies need to file ACA forms to meet the requirement. However, tax filing is always challenging, especially if one takes the DIY approach. Nonetheless, this guide provides some simple guidance on the matter.

Who should fill out forms 1094-C and 1095-C?

Employers must fill out forms 1094-C and 1095-C with 50 or more employees. The tax filing should include all the employees of that company, no matter the number.

How to File the Form 1094-C

An employer must send ACA forms to all employees.

PART I: This section contains the employer’s identification number, the employer name, physical address, and point of contract. The section has some employees on Form 1095.C. Accuracy is key in this section; do not mix up details of the employees or miss the employees’ Form 1095-C number.

PART II: This section is problematic during the tax filing process, especially with line 22. This section is conducted for the certification of eligibility. Yes, it’s the essential part one must get right. Line 22 designates if an employer can use transition relief or use the offer method. The following boxes are provided for employers to check;

  • Qualifying Offer Method: One should choose this option if they made a qualifying offer known as minimum essential coverage. This should apply to one or more full-time employees for the whole year they render their services.

A & B: Reserved: Avoid sections B and C because they are no longer valid from 2015.

  • 98% Offer Method: An employer should select this option if they provide a minimum value of not less than 98% of the employees. Also, employers providing affordable health coverage should use this option.

PART III: In this section, an employer should indicate whether they provided minimum essential coverage of not less than 95% of the full-time employees for the whole calendar year. One should check the “Yes” checkbox on line 23 for “All 12 Months.” Suppose the company adhered to the above. But if the company did not provide minimum essential health coverage, one must indicate the months they failed to provide the minimum essential health coverage by selecting “NO.”

PART IV: This section should be filled by those who have selected the “Yes” checkbox on line 23 for “All 12 Months.” If one was a member of ALE, one must indicate the EIN group member’s name. The form provides up to 30 aggregated ALE Groups. However, you can indicate the top 30 members if they exceed 30.

How to Fill Out Form 1095-C

Form 1095-C is for the employees, and as an employer eligible to perform this tax filing procedure, one must submit ACA forms for each employee.

PART I: This section is where an employee’s information should be submitted. The information includes the employee’s name, address, social security number, and the employer’s detailed information.

PART II: The section displays options to declare all the coverage the employee received for the entire year. The section provides different codes corresponding to the specific coverage the employee received.

PART III: The section is for employers who provide health reimbursement arrangements and self-insured major medical plans.