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Understanding Form 1095-C

for ACA Compliance

What is Form 1095-C?

The Affordable Care Act (ACA) requires employers with 50 or more full-time or full-time equivalent employees, also known as Applicable Large Employers (ALEs), to distribute yearly 1095-C documents to their full-time employees.
  • This regulation also requires smaller employers with 50-99 full-time employees who don’t offer health coverage to submit a 1095-C form.

Form 1095-C is an IRS form that verifies the healthcare coverage offered by an employer meets ACA standards. It includes details such as the type of coverage provided, the available months, and whether it meets the minimum essential coverage requirements under the ACA.

The IRS uses this form to ensure ALEs are meeting their obligations under the ACA’s Employer Shared Responsibility Provision.

Essential Reporting Requirements and Deadlines

Form Distribution Deadline: March 3, 2025

Employers must distribute Form 1095-C to employees by March 3, 2025, for the 2024 tax year to ensure they have accurate tax filing information. This form is then filed with the IRS to report employee health insurance details.

Filing Deadlines

Forms are typically filed electronically or by paper (if under 250 forms). Employers should verify the specific IRS requirements for their chosen filing method.

Data Included

Form 1095-C includes information on coverage, employee and employer contributions, and whether the plan met the ACA’s affordability criteria.

What is the Employer Filing Process?

1. Compile Employee Data:

Gather necessary health coverage data for each full-time employee, including plan details and contribution amounts.

2. Complete Forms:

Complete each form with accurate monthly information on the coverage offered.

3. Distribute Forms to Employees:

Ensure forms are distributed by or before the  March 3, 2025, deadline.

  • Distributions can be done either electronically or (with employee consent) or via mail .
4. File with the IRS:

File forms 1095-C with the IRS, alongside form 1094-C a transmittal form, by March 31, 2025 (if filing electronically) or February 28, 2025 (if filing by paper).

What Employees Need to Know

Employees use Form 1095-C to verify their health insurance status when filing taxes. 

  • Distributions can be done either electronically or (with employee consent) or via mail.

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Additional Resources

https://www.irs.gov/e-file-providers/affordable-care-act-information-returns-air

https://dchr.dc.gov/ko/page/affordable-care-act-form-1095-c-frequently-asked-questions

https://www.irs.gov/pub/irs-pdf/f1095c.pdf

https://www.aha.org/system/files/media/file/2021/06/fact-sheet-reference-based-pricing-1118.pdf

https://www.irs.gov/affordable-care-act/employers/determining-if-an-employer-is-an-applicable-large-employer

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