As we move into 2026, employers should be preparing for upcoming Affordable Care Act reporting obligations related to health coverage provided during the 2025 calendar year. Both federal and certain state laws require employers and plan sponsors to report health coverage information.
Understanding which rules apply to your organization and where your employees live can help avoid last-minute issuesand potential penalties.
Who Has Federal ACA ReportingObligations
Under the ACA, an employer is considered an Applicable Large Employer, or ALE, for 2025 reporting if itaveraged 50 or more full-time equivalent employees during 2024. ALE status determines whether an employer must complete Forms 1095 reporting for 2025.
In addition, employers of any size that sponsor a self-funded major medical plan have separate reporting obligations related to individuals who were covered under the plan, regardless of full-time status.
Federal Reporting Options andDeadlines
For coverage provided in 2025, employers generally have two compliance approaches under federal rules.
Under the first option, employers furnish Form 1095-C to full-time employees, or Form 1095-B/1095-C to individuals covered under a self-funded plan. These forms must be provided byMarch 2, 2026. Employers must also file copies of the forms, along with the applicable transmittal form, with the IRS by March 2, 2026 if filing on paper or by March 31, 2026 if filing electronically. Most employers file electronically.
Instead of distributing Form 1095-B/C, employers may post a notice on their website informing individuals that the applicable form is available upon request. The notice must include contact information and be posted by March 2, 2026, remaining available through mid-October. Employers choosing this option must still be able to generate and furnish forms promptly upon request and must still file with the IRS by the applicable deadlines.
Self-Funded Plan Considerations
Employers sponsoring self-funded medical plans, whether large or small, are subject to reporting requirements for all covered individuals, not just full-time employees. While the same two federal reporting options are available, many employers find that furnishing forms directly is best when certain state reporting requirements also apply, since some states require individual delivery regardless of federal posting rules.
State Reporting Obligations
Although the federal individual mandate penalty was eliminated, several states and the District of Columbia have adopted their own individual health coverage mandates. These states impose additional reporting obligations on employers and insurers to support enforcement of state requirements.
For 2025 coverage, states with employer reporting obligations include California, the District of Columbia, Massachusetts, New Jersey, and Rhode Island. Deadlines vary by state.
Employers with self-funded plans are typically responsible for both furnishing forms to residents and filing with the state. Employers with fully insured plans often rely on their insurers to complete state filings, but it is important to confirm that the insurer is handling this obligation.
Vermont currently has an individual mandate but does not require employer or insurer reporting at this time.
Key Action Steps for Employers
Employers should review where their employees reside, confirm whether they are an ALE or sponsor a self-funded plan, and identify which federal and state reporting rules apply. Monitoring deadlines and confirming responsibilities early can help ensure timely and accurate reporting.
If you would like to learn more aboutBAS’ ACA data collection and reporting services, reach out to your accountmanager or contact solutions@basusa.com.
Benefit Allocation Systems (BAS) provides best-in-class, online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 can Integrate with any insurance carrier for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and many others), and integrate with any payroll system for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and many others).
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.
