Affordable Care Act (ACA) Tax Penalties for forms 1095-B and 1095-C

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With the new Affordable Care Act laws and IRS forms have come new penalties for failure to comply. These 1095 penalties and the ways in which you can incur them vary depending on whether you're in the role of the insurance provider or the insurance recipient. For instance, insurance recipients who file Form 1095-A and fail to enroll in or keep a health insurance plan with at least the minimum coverage required during the calendar year could be subject to the IRS ACA penalty. Providers of insurance, and filers of IRS Form 1095-B or IRS Form 1095-C, may incur penalties if they fail to provide adequate insurance as defined by the ACA, or if they fail to report this information to the IRS or their recipients.

Complete your 1095-C filing/1095-B filing before the deadline to avoid penalties.

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Liability for the Employer Shared Responsibility Payment

Penalty for Not Providing Health Coverage	Penalty for Filing Forms Late
Coverage offered to fewer than 95% (70% for 2016) of your full-time employees The penalty is a payment of 1/12 of $2,880 per full-time employee after your first 30 full-time employees per month. Coverage offered to at least 95% (70% for 2016) of your full-time employees but it didn't meet the guidelines as outlined by the ACA The penalty is a payment of 1/12 of $4320 per Premium Tax Credit received by full-time employees per month. This penalty is subject to limitation.	For late filing of Form 1095-B, Form 1095-C or failing to file at all, the penalties are as follows: Forms filed late, but within 30 days: $60 per report, $630,500 maximum penalty Forms filed late, but by August 1: $120 per report, $1,891,500 maximum penalty Forms filed after August 1 or not at all: $310 per report, $3,783,000 maximum penalty

Penalty for Not Providing Health Coverage

Penalty for Filing Forms Late

Coverage offered to fewer than 95% (70% for 2016) of your full-time employees

The penalty is a payment of 1/12 of $2,880 per full-time employee after your first 30 full-time employees per month.

Coverage offered to at least 95% (70% for 2016) of your full-time employees but it didn't meet the guidelines as outlined by the ACA

The penalty is a payment of 1/12 of $4320 per Premium Tax Credit received by full-time employees per month. This penalty is subject to limitation.

For late filing of Form 1095-B, Form 1095-C or failing to file at all, the penalties are as follows:

Forms filed late, but within 30 days: $60 per report, $630,500 maximum penalty
Forms filed late, but by August 1: $120 per report, $1,891,500 maximum penalty
Forms filed after August 1 or not at all: $310 per report, $3,783,000 maximum penalty

ACA Resources

Affordable Care Act (ACA) Filing

The new Affordable Care Act Forms 1094 and 1095 are required to be filed beginning with the 2023 tax year. Anyone who provided at least the Minimum Essential Coverage (MEC) of health insurance to individuals will need to file these forms.

With ExpressIRSForms, you won't believe how easily you can e-file these new forms.

ACA Forms 1095 and 1094

The Affordable Care Act forms are new information returns created by the IRS to make sure that health insurance providers and employers provide at least the Minimum Essential Coverage (MEC) to their recipients and employees during the calendar year.

This is to help insurance providers and recipients remain compliant with the new healthcare laws.

ACA Employer Exemptions

50-99 employees: No payment is required under section 4980H(a) or (b) for 2016 if you did not reduce the size of your workforce, overall service hours, or health coverage between Feb. 9, 2014-Dec. 31, 2014.

100+ employees: If you had 100+ full-time employees on business days in 2015 and owe a payment under 4980H(a), calculate your 2016 transition relief by reducing your number of full-time employees by your allocable share of 80 (rather than 30).

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