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The IRS has released an early draft of the 2024 instructions for Form 1094-B, Transmittal of Health Coverage Information Returns, and Form 1095-B, Health Coverage. These forms are used to report information about individuals who are covered by minimum essential coverage (MEC) during the tax year.
Form 1095-B is specifically used by providers of MEC, such as insurance companies and smaller, self-insured employers, to report information about the individuals they cover. This form helps the IRS confirm whether individuals have health coverage under the Affordable Care Act (ACA) and determines eligibility for the premium tax credit, which assists taxpayers in paying for health insurance through the Health Insurance Marketplace. Organizations use Form 1094-B as a transmittal summary when submitting the returns to the IRS.
There is a distinction between Forms 1094/1095-B and Forms 1094/1095-C. While the B-series forms are used by insurance companies and smaller self-insured employers, the C-series forms are required for applicable large employers (ALEs)—those with 50 or more full-time employees. Form 1095-C is used by ALEs to report whether they offered health coverage to their full-time employees, the details of that coverage, and whether the employee was enrolled. If the ALE is self-insured, Form 1095-C will also report the individuals covered under the plan. ALEs use Form 1094-C to transmit the 1095-C forms to the IRS, and it also serves as an employer's declaration of whether they offered the required MEC to their employees under the ACA’s employer mandate.
The main difference between the two series lies in the entities responsible for filing and the scope of information reported, with the C-series focusing on large employers and their specific compliance with ACA employer mandates.
With the release of instructions to Form 1094/1095-B, organizations can prepare for upcoming filing requirements. It is anticipated that the 1094/1095-C instructions will also be released soon.
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