Holding true to its holiday tradition, the IRS yet again decided to extend the deadline by which providers of minimum essential coverage (including certain applicable large employers (“ALEs”)) must furnish information statements to individuals regarding their 2019 insurance coverage. However, due to the effective elimination of the ACA’s individual mandate penalty through the Tax Cuts and Jobs Act (“TCJA”), the IRS went one step further than in past years by allowing certain providers to forgo the individual furnishing requirement, if certain notice requirements are met instead.

Sections 6055 and 6056 of the Internal Revenue Code (the “Code”) require providers of minimum essential coverage to file annual information returns with the IRS and furnish individuals with certain information statements regarding the insurance coverage they provided in the previous year. Providers furnish this information to individuals on either a Form 1095-B (Health Coverage), which is filed by non-employer providers, or a Form 1095-C (Employer Provided Health Insurance Offer and Coverage), which is filed by ALEs. These information returns typically must be provided to the individual by January 31 of the following year. Failure to timely file and furnish these information returns potentially subjects filers to penalties under sections 6721 and 6722. Such penalties amount to $540 for a combined failure to file and furnish a single 2019 information return as required in 2020.

Since 2015, the IRS has exercised its authority under Treasury Regulations §§ 1.6055-1(g)(4)(i)(B)(1) and 301.6056-1(g)(1)(ii)(A) to grant a 30-day extension to the deadline for furnishing individuals with their Form 1095-B or Form 1095-C.  (Past IRS notices granting such extensions and/or providing good faith penalty relief include Notice 2015-68, Notice 2015-87Notice 2016-4Notice 2016-70Notice 2018-06, and Notice 2018-94.)  IRS Notice 2019-63 provides for this same extension with regard to insurance coverage provided in 2019 and extends the deadline to March 2, 2020. Consistent with past years, this extension does not extend to a provider’s obligation to file certain information returns with the IRS. Providers that fail to file the applicable forms with the IRS by February 28, 2020 (or March 31, 2020, if filing electronically) will still be subject to penalties, unless the filer shows reasonable cause for the failure.

In addition to the 30-day extension, Notice 2019-63 provides additional relief to providers that would typically be required to furnish Forms 1095-B to individuals who received insurance coverage in 2019. Previously and pursuant to section 1501(b) of the ACA, section 5000A of the Code required individuals to either (a) maintain minimum essential coverage, (b) qualify for an exemption to minimum essential coverage, or (c) make an “individual shared responsibility payment” when they file their tax returns. The TCJA reduced the individual shared responsibility payment to zero for months beginning after December 31, 2018. Based on this development, the IRS reexamined the necessity of furnishing Forms 1095-B. Accordingly, the IRS announced in Notice 2019-63 that providers need not furnish individuals with a Form 1095-B if they satisfy the following two requirements:

  1. The provider must prominently post on its website a notice that includes:
    • a statement that the individual may receive their Form 1095-B upon request,
    • the email address and physical address to which a request may be sent, and
    • the phone number by which an individual may contact the provider with questions; and
  2. The provider must furnish the 2019 Form 1095-B within 30 days of receiving such request from an individual.

ALEs that maintain self-insured health plans are still required to furnish their full-time employees (including full-time equivalent employees) with Forms 1095-C. However, Notice 2019-63 provides that such ALEs may take advantage of this notice relief to the furnishing requirement with regard to any employee enrolled in their self-insured health plan to the extent the employee was not a full-time employee for any month in 2019.