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As part of ongoing Affordable Care Act (ACA) compliance, employers should ensure they are collecting Social Security Numbers (SSNs) not only for employees but also for all covered dependents enrolled in the employer-sponsored health plan. While this may seem like a minor detail, it plays an important role in ACA reporting and avoiding IRS penalties.
Why Dependent SSNs Matter
Under IRS regulations, Applicable Large Employers (ALEs) must report coverage information annually using Forms 1095-C and 1094-C. These forms allow the IRS to enforce both the individual and employer mandates and to verify whether individuals had minimum essential coverage (MEC).
To do this accurately, the IRS requires a Taxpayer Identification Number (TIN)—usually a Social Security Number—for each covered individual. This includes spouses and dependent children enrolled in the health plan.
What If You Don’t Have a Dependent’s SSN?
If a dependent’s SSN is not available, the IRS allows employers to use the dependent’s date of birth—but only if they have made a reasonable effort to obtain the SSN first.
To meet the “reasonable effort” standard, employers must:
- Request the dependent’s SSN at the time of enrollment.
- Make a second request within 75 days if the SSN is not provided.
- Make a third and final request by December 31 of the same reporting year (or within 75 days of the second request if later).
Failing to follow this process can result in inaccurate or incomplete filings, which may lead to IRS penalties for incorrect Forms 1095-C.
Best Practices for HR
- Review your enrollment forms and ensure there is a clear prompt for dependent SSNs.
- Communicate to employees why this information is required and how it is used.
- If dependents are already enrolled without SSNs on file, start the reasonable effort process immediately.
- Work with your benefits administrator or technology vendor to track outreach attempts and responses.
- Safeguard this information in accordance with HIPAA and internal data privacy protocols.
Final Note
Collecting dependent SSNs may not seem urgent until reporting time—but by then, it’s often too late. Building this into your enrollment and documentation process now can help your organization stay in compliance and reduce reporting burdens later in the year.
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This article is for informational purposes only and is not intended as legal, tax, or benefits advice. Readers should not rely on this information for taking (or not taking) any action relating to employment, compliance, or benefits. Always consult with a qualified professional before making decisions based on this content.
