The Affordable Care Act requires virtually all Americans to have health insurance coverage or pay a tax penalty. The requirement to have health insurance is referred to as the “individual mandate” and the tax penalty is referred to as the “shared responsibility payment.” Starting with the 2019 plan year, the shared responsibility payment was reduced to $0, thereby effectively eliminating the individual mandate.
New Jersey has implemented its own individual mandate and requires New Jersey residents to have qualifying health coverage or pay a fee with their state taxes. New Jersey requires coverage providers (including insurers and self-funded employers) to report their health coverage information to the state. The purpose is for New Jersey to verify health coverage information supplied by individual taxpayers. The first annual reporting is due May 15, 2020.
Reporting must be completed through New Jersey’s system for filing Forms W-2. Coverage providers must provide the New Jersey Division of Taxation with a 1095 health coverage form for each primary enrollee who was a New Jersey resident and was provided minimum essential coverage in 2019. This applies to both part-year and full-year New Jersey residents. For 1095 filing purposes, a part-year resident is an individual who lived in New Jersey for at least 15 days in any month.
These requirements apply to both in-State and out-of-State employers. They are not limited to businesses that withhold New Jersey payroll taxes. Out-of-State employers who provide coverage to New Jersey residents must make sure New Jersey receives a copy of each Form 1095 provided to any New Jersey resident employed.
BAS offers state ACA reporting services for clients contracted for full ACA services. For more information, contact your account manager or ACA-Services@BASusa.com.