Now that tax season has arrived, both individuals and employers must take certain steps to demonstrate proof of health insurance coverage. Yes, the penalty for failing to comply with the ACA is set at 0 dollars at the federal level, but documentation of coverage is still required. And now that California has instituted its own mandate, you will need to complete these requirements for your state taxes as well.
If you receive health insurance through Covered California… You need to file Form 1095-A when you do your taxes. Watch your mailbox; this form should arrive by the deadline of January 31.
If you enroll in health insurance directly through an insurance carrier, or you’re on Medicare… You should receive Form 1095-B by January 31. This is the form you will file with your tax returns.
In both cases, your insurance carrier is responsible for sending you these forms.
If you’re covered by a group health insurance policy, and your employer has 50 or more full-time employees… You will need to file Form 1095-C with your tax returns. Your employer is responsible for giving you this form, and might do so in person, by mail, or by email if you have given consent. They must complete this step by January 31.
File your taxes by the end of the day on Monday, April 18. This is the deadline for everyone, regardless of employment or health insurance status. You can file with a paper return, or online using tax software.
If you don’t have everything you need, or you need more time to complete your tax return for some other reason, you can request an extension. Then you have up to six months to finish your return. However, you must request the extension by the same date (April 18) or else face penalties and possible fines for failing to file.
However and whenever you choose to file your taxes, keep a copy in your files. Keep your 1095 form, too, so that you can provide proof of health insurance coverage if it is requested.
If you need more assistance understanding ACA compliance and tax filing requirements, give us a call. We will be happy to answer your questions.