Applicable large employers (ALE ‘s) (employers subject to the Internal Revenue Code (Code) Section 4980H Employer Shared Responsibility provisions) contributing to a multi-employer health coverage plan face some unique coordination challenges to comply with their reporting obligations under the Affordable Care Act (ACA). A multi-employer plan is typically a plan that covers the employees of unrelated companies in accordance with a collective bargaining agreement.
As background, an applicable large employer (ALE) is an employer that employed an average of at least 50 full-time and full-time equivalent employees on business days during the preceding calendar year. ALE members are required by Code Section 6056 to report details of health coverage offered, including cost and affordability, using Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and Form 1095-C, Employer-Provided Health Insurance Offer and Coverage.
Based upon the recent instructions to the 2015 Form 1095-C, there will be some relief provided for the filing year 2015 for ALE’s with regard to filing Form 1095-C as follows:
- The Multi-employer Plan is required to report the “Health Coverage” information on behalf of all Employers contributing to the Plan on behalf of employees. This will be filed with the Internal Revenue Service on form 1095-B by the Plan.
- If an Employer is determined to be an ALE, the ALE will report the following on Part II of Form 1095-C; Line 14 =1H (no offer of coverage), Line 15 = n/a, and Line 16 = 2E (Multi-employer interim rule relief). For reporting in 2015, Code 1H may be entered without regard to whether the employee was eligible to enroll in coverage under a multi-employer plan.
- Only full time employees will be issued a 1095-C.
- For the ALE filing, Part III of Form 1095-C will be blank as the Multi-employer Plan has filed this information as part of the requirements of Form 1095-B.
If the ALE has “other employees” that are not covered by the multi-employer plan, it must also report those employees using a separate Form 1095-C.
If such “other employees” are covered by an insured plan, the insurance company would do the reporting required under Part III of Form 1095-C. If such “other employees” are covered under a self-insured arrangement, the employer would complete Part III of Form 1095-C.
Please note that as a practical matter, for 2015, the Multi-employer Plan does not tell an Applicable Large Employer who participates in the Plan, whether an individual for whom contributions are made is actually eligible for coverage under the Plan.
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