By now, applicable large employers and employers with self-funded plans should have furnished 1095 forms to their employees and covered individuals. Some individuals may be contacting employers to advise them of mistakes on the forms.
Mistakes should be corrected as soon as they are identified. A correction can be as simple as preparing and furnishing a new 1095 form, indicating that the newly furnished form should replace the previously provided version. Once the 1094 has been transmitted to the IRS, it is more difficult to correct an individual’s Form 1095.
According to the IRS Instructions for Form 1094-C/B and Form 1095-C/B, a corrected return should be filed as soon as possible after an error is discovered.
Form 1095-C
If the Form 1095-C has been filed with the IRS, a new, fully-completed Form 1095-C with the correct information must be submitted. An “X” entered in the CORRECTED checkbox on the form. The Form 1094-C transmittal (not marked corrected) with the corrected 1095-C forms must be filed with the IRS, and the employee must receive a copy of the revised Form 1095-C.
If the 1095-C has not been filed with the IRS, the individual should receive a revised form and be advised that it is corrected. It is not necessary to enter “X” in the corrected checkbox on the form.
Form 1094-C
If incorrect information is filed with the IRS on a Form 1094-C authoritative transmittal, a new, fully-completed Form 1094-C with the correct information must be filed, with an “X” in the CORRECTED checkbox on the form.
Form 1095-B
If the 1095-B with the error has not been filed with the IRS, a revised form with the correct information must be provided to the individual, and the individual must be advised that the new form is a correction. There should not be an “X” entered in the corrected checkbox. That checkbox is used only when correcting a Form previously filed with the IRS.
If a Form 1095-B has been filed with the IRS and an error is discovered, a corrected return must be filed with the IRS as soon as possible. Form 1095-B must be fully completed with the correct information and an “X” marked in the CORRECTED checkbox. A Form 1094-B transmittal must be filed with the corrected 1095-B form(s). A copy of the corrected Form 1095-B must be furnished to the individual who received the incorrect form.
A corrected Form 1095-B must be filed to report retroactive changes in coverage. The IRS provides the following specific examples:
Example 1. Tim enrolls in health insurance with Ace Insurance Company in January 2015. Tim fails to pay his premiums for November and December 2015 and January 2016. Ace sends Tim a Form 1095-B on January 31, 2016, reporting coverage for every month in 2015. On February 1, 2016, Ace cancels Tim’s coverage effective November 1, 2015. Ace must send Tim a corrected Form 1095-B reporting that Tim was covered only for January through October 2015. If Ace filed the Form 1095-B with the IRS it must file a corrected Form 1095-B with the IRS reporting coverage only for January through October.
Example 2. Sharon is enrolled in Medicaid for January through September 2015. The Medicaid agency files a Form 1095-B and furnishes a statement to Sharon reporting coverage for January through September 2015. In April 2016, Sharon is approved for Medicaid coverage beginning on November 1, 2015. The Medicaid agency must file a corrected Form 1095-B with the IRS and furnish Sharon a corrected statement reporting coverage for January through September and November through December 2015.
Form 1094-B
If incorrect information is filed with the IRS on a Form 1094-B transmittal, a new, fully-completed Form 1094-B with the correct information must be filed, with an “X” in the CORRECTED checkbox.
Exceptions
Incorrect Taxpayer Identification Number. IRS regulations do not require an employer to file a corrected return for missing or incorrect taxpayer identification numbers ONLY if the employer meets the reasonable cause criteria for obtaining TINs. This would include making an initial and subsequent yearly requests for the TIN.
A summary of the reasonable cause criteria is found here.
The IRS has provided the following chart for examples of errors and instructions for filing corrected returns that have previously been filed with the IRS:
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Original Authoritative Form 1094-C |
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IF any of the following are incorrect .... |
THEN ...
1. Prepare a new authoritative Form 1094-C 2. Enter an “X” in the “CORRECTED” box at the top of the form 3. Submit the standalone corrected transmittal with the correct information present
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ALE Member or Designated Government Entity (Name and/or EIN) Total Number of Forms 1095-C filed by and/or on behalf of ALE Member Aggregated Group Membership Certifications of Eligibility Minimum Essential Coverage Indicator Full-Time Employee Count for ALE Member Aggregated Group Indicator Section 4980H Transition Relief Indicator |
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Original Form 1095-C Submitted to IRS and Furnished to Employee |
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IF any of the following are incorrect .... |
THEN ... |
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Name, SSN, Employer EIN Offer of Coverage Premium Amount Safe Harbor and Other Relief Codes Covered Individuals Information |
1. Prepare a new Form 1095-C 2. Enter an “X” in the “CORRECTED” box at the top of the form 3. Submit corrected Form 1095-Cs with a non-authoritative Form 1094-C transmittal to the IRS 4. Furnish a corrected Form 1095-C to the employee |
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Original Form 1095-B Filed with the IRS and Furnished to the Recipient |
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IF any of the following are incorrect ... |
THEN ... |
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1. Fully complete a new Form 1095-B and enter an “X” in the CORRECTED checkbox 2. File a Form 1094-B Transmittal with the corrected Form 1095-B 3. Furnish a copy of the corrected Form 1095-B to the person identified as the responsible individual
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Name of responsible individual (Part I) Social security number (SSN) or taxpayer identification number (TIN) (Part I) Origin of the policy (Part I) Employer-Sponsored Coverage Information (Part II) Issuer or Other Coverage Provider (Part III) Covered Individuals Information (Part IV) |
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Employers should be monitoring notifications of errors on 1095 forms and determining if corrected forms should be sent to individuals (and to the IRS if the 1094 forms have already been transmitted).
