On December 23, 2024, Congress passed two bills affecting Affordable Care Act (ACA) employer reporting under sections 6055 and 6056, pending the President’s signature.
These changes, effective for the 2024 reporting year (with returns due in early 2025), include:
Form 1095 Distribution: Employers can satisfy distribution requirements by posting a notice of availability and providing the forms upon request, rather than distributing them to all employees.
Use of Date of Birth: Employers reporting self-funded group health plan coverage for spouses and dependents have increased flexibility to use an individual’s date of birth when a Tax Identification Number (TIN) is unavailable.
Electronic Distribution: The legislation permits employers and insurance providers to offer Forms 1095-B and 1095-C electronically, adhering to current IRS requirements.
Response Time to IRS Letters: Applicable Large Employers (ALEs) will have at least 90 days to respond to IRS 226-J letters, an increase from the previous 30-day period.
Statute of Limitations: A six-year statute of limitations is established for collecting penalty payments related to reporting.
These modifications aim to ease the reporting process for employers without significantly altering existing requirements.
It’s important to note that this federal relief may not apply to state-level reporting requirements in California, Massachusetts, New Jersey, Rhode Island, or the District of Columbia for the 2024 reporting year.
Employers should review these changes to ensure compliance with both federal and state ACA reporting obligations.