1095 Forms and Reporting

What Forms 1095-B and 1095-C Report

The Affordable Care Act requires employers that provide applicable employer-sponsored health insurance to report that insurance to the IRS and to employees. Forms 1095-B and 1095-C are the IRS statements used to fulfill this requirement, each covering different employers and reporting different information about the insurance offered.

Which form applies to your business?

Businesses With Fewer Than 50 Full-Time Employees

Small employers, generally those with fewer than 50 full-time employees, including full-time equivalent employees, are not subject to the employer shared responsibility provisions of the Affordable Care Act. However, you may still have reporting responsibilities.

Form 1095-B

If your employees are enrolled in a Covered California for Small Business health insurance plan, the health insurance company will generally issue Form 1095-B to each enrolled employee. If your employees are covered by Medi-Cal or another government-sponsored program, the government agency will issue Form 1095-B instead.

You do not need to file Form 1095-B with the IRS as a small employer using a fully insured plan.

For more information, see IRS Form 1095-B information.

W-2 Reporting

Small employers that provide applicable employer-sponsored insurance under a group health insurance plan are required to report the cost of that insurance on each employee's Form W-2 in Box 12, Code DD. This reporting is for informational purposes only — it does not mean the insurance is taxable income for the employee.

The amount reported should include both the portion paid by the employer and the portion paid by the employee.

Coverage types vary in whether they must be reported, are optional or are not required. For the complete list of coverage types and their reporting requirements, seeIRS Form W-2 reporting of employer-sponsored health insurance.

Note: Employers are not required to issue a Form W-2 solely to report health insurance costs for retirees or former employees who would not otherwise receive a W-2.

Additional Medicare Tax

Additional Medicare Tax applies to wages, compensation and self-employment income above a threshold amount. Employers must withhold and report an additional 0.9 percent of Medicare Tax on employee wages or compensation that exceed $200,000.

Self-Insured Plans

If your business sponsors a self-insured health insurance plan, you may have additional IRS reporting responsibilities even if you have fewer than 50 full-time employees. Consult a tax professional or IRS guidance on employer shared responsibility provisions.

Common Ownership

If your business has fewer than 50 full-time employees but is part of an ownership group with 50 or more full-time equivalent employees combined, you may be subject to the rules for applicable large employers. Consult a tax professional to determine your status.

Businesses That Are Applicable Large Employers

An applicable large employer is generally a business with 50 or more full-time employees, including full-time-equivalent employees, during the prior calendar year. For a full overview of employer mandate requirements, see the Employer Mandate page.

Form 1095-C

As an applicable large employer, you are required to issue Form 1095-C to each full-time employee for one or more months of the calendar year — including employees who did not enroll in your health insurance plan. You must also send an annual statement to all eligible employees describing the health and dental insurance available to them.

All Covered California for Small Business health insurance plans provide minimum essential coverage.

For more information, see IRS Form 1095-C information.

Form 1094-C Transmittal

Form 1094-C is the transmittal form you file with the IRS along with your Forms 1095-C. It summarizes the total number of forms issued, employee counts by month, and whether you offered coverage to at least 95 percent of your full-time employees and their dependents.

For complete filing instructions, refer to a tax professional or the IRS Form 1095-C instructions (PDF).

Information You May Need for Form 1095-C and Form 1094-C

If your business is an applicable large employer, gather the following information before completing your annual reporting forms — starting with identifying information for your business and each full-time employee, including names and addresses.

How Employees Use Forms 1095-B and 1095-C

Employees who receive Form 1095-B or Form 1095-C should keep these forms with their tax records. These forms show proof of health insurance and may be used when filing a tax return.

Employees do not need to wait for Form 1095-B or Form 1095-C to file their taxes, and they should not attach these forms to their tax return. If an employee has questions about the information on their form, they should contact the party that issued it — either the health insurance company (for Form 1095-B) or the employer (for Form 1095-C).

Covered California does not issue, correct or resolve disputes for Forms 1095-B or 1095-C. If an employee received a Form 1095-A, they were enrolled in an individual-market Covered California health insurance plan, not a Covered California for Small Business plan.