IRS Issues Proposed Rules on Annual Reporting Requirements

The IRS has issued proposed regulations on two separate reporting requirements under the Affordable Care Act.  Tax penalties may be enforced for failure to comply unless the failure is due to reasonable cause and not willful neglect.  Both of the requirements have been delayed for one year with the first reports due in 2016 for the 2015 calendar year.

The regulations under section 6055 of the Internal Revenue Code impose new reporting requirements on health insurers, sponsors of self-funded group health plans, and others who provide individuals with minimum essential health coverage.  These health benefit providers must provide a report to the IRS and a statement to enrolled individuals containing specific information which will be used to administer the individual mandate.  The information will be on a monthly basis even though the report will be prepared on an annual basis.

The regulations under section 6056 require large employers (more than 50 full-time employees or full-time equivalents) to provide a report to the IRS and a statement to all full-time employees containing information about the employer-provided coverage that is offered, even if the individual is not enrolled in the coverage.  This information will then be used to administer the employer mandate. This report also contains monthly information but is reported on an annual basis.  The IRS will also use this report to administer the premium tax credit under section 36B of the Internal Revenue Code.