10/6/20

2020 Form 1095-C Distribution Extension

Related Practices

Attorneys & Professionals

Deadline to distribute Form 1095-Cs to employees extended

On October 2, 2020, the IRS published Notice 2020-76 , announcing an automatic 30-day extension of the deadline to distribute 2020 Form 1095-Cs to employees. 

The IRS indicated that because it automatically extended the deadline to distribute Form 1095-Cs, it will not grant or respond to requests for further extension of the distribution deadline.

Deadline to file Form 1095-Cs with IRS not extended

The deadline to file 2020 Forms 1094-C and 1095-C with the IRS was not extended.  The deadline to file with the IRS is:

You can get an automatic 30-day extension of the filing deadline by filing IRS Form 8809, Application for Extension of Time to File Information Returns, before the original filing deadline.

The IRS also extended a good faith compliance standard to the 2020 Form 1095-Cs.  This means that the IRS will not impose penalties as a result of incorrect or incomplete information in Form 1095-Cs (such as incorrect Social Security numbers or dates of birth), provided you made a good faith effort to comply and the Forms were distributed and filed by the applicable deadlines.  The IRS noted that this is the final extension of the good faith compliance standard (meaning the IRS does not intend to apply a good faith compliance standard to 2021 reporting). 

Option to skip distributing Form 1095-Cs to individuals who were not full-time employees

IRS Notice 2020-76 continues the option (first announced last year) to skip sending Form 1095-Cs to individuals who were not classified as full-time employees in 2020.  An employer need not provide a Form 1095-C to an individual if all of the following apply:

  1. The individual was not classified as a full-time employee in any month in 2020 (i.e., when the “all 12 months” column” of Line 14 on Form 1095-C is Code 1G).  Examples may include covered part-time employees, COBRA qualified beneficiaries and retirees who were not employed in 2020, and outside directors.
  2. The employer posts a prominent notice on its website that includes (a) a statement that the individual may receive a copy of his or her 2020 Form 1095-C upon request; (b) an email address where the individual may write to request a Form 1095-C; (c) the street address where the individual may write to request a Form 1095-C; and (d) a telephone number which the individual can call with questions. 
  3. If an individual requests a Form 1095-C, the employer sends it within 30 days.

Section 6055 Furnishing Relief does not allow an employer to skip filing Form 1095-Cs with the IRS.  The employer is still required to file all Form 1095-Cs with the IRS, including those for individuals to whom the employer did not mail a Form 1095-C based on Section 6055 Furnishing Relief. 

Option to skip distributing Form 1095-Bs

IRS Notice 2020-76 also continues the option for a multiemployer plan or insurer to skip sending Form 1095-Bs to individuals if it provides the website notice (as described above) and mails a Form 1095-B within 30 days of a request from an individual.  As is the case for Form 1095-Cs, the plan or insurer is still required to file all 2020 Form 1095-Bs with the IRS.

State Filings

The so-called individual mandate (the tax penalty imposed on individuals who fail to maintain health coverage) was repealed by the Tax Cuts and Jobs Act of 2017.  However, California, Massachusetts, New Jersey, Rhode Island, and Washington D.C. have their own individual mandates along with requirements that employers report health coverage provided to employees in the state or district.