For Applicable Large Employers (ALEs), ACA reporting is an annual requirement. Form 1095-C is used to report health coverage offers to full-time employees and the IRS. Because the form requires month-by-month reporting, if there are even small gaps in payroll, HR, or benefits data, those can lead to corrections, penalties, or compliance issues down the line.<\/p>\n
In this blog, we cover 1095-C filing requirements, who must file, what information to report, key deadlines, and best practices for staying compliant. Here\u2019s what employers need to know.<\/p>\n
As an ALE, your ACA reporting responsibilities go beyond simply issuing Form 1095-C. You’re required to report to both the IRS and your full-time employees about the health coverage you offered during the year, regardless of whether those employees enrolled in your health plan.<\/p>\n
In general, an employer qualifies as an ALE if it averaged at least 50 full-time employees, including full-time equivalent employees, during the previous calendar year. For ACA reporting purposes, a full-time employee is generally someone who averages 30 hours of service per week or 130 hours in a month.<\/p>\n
Your 1095-C filing requirements generally fall into two categories:<\/p>\n
As an ALE, you must report whether you offered minimum essential coverage to each full-time employee for every month of the reporting year. This information is reported in Part II of Form 1095-C using IRS indicator codes that reflect the type of coverage offered, employee affordability, and any applicable safe harbor provisions.<\/p>\n
Because the form requires month-by-month reporting, your payroll, HR, and benefits records should align to ensure the information reported is accurate.<\/p>\n
If you’re a self-insured employer, you have additional reporting obligations. Along with reporting the offer of coverage, you must also report the individuals who were enrolled in your self-insured health plan. Self-insured ALE Members must use Form 1095-C and transmittal Form 1094-C. This information is reported in Part III of Form 1095-C and may include employees, their spouses, dependents, retirees, or other covered individuals, as applicable.<\/p>\n
Part III reporting may still be required even if an employee wasn’t full-time for every month of the year, provided they were enrolled in your self-insured health plan during the reporting period. If the employer is a non-ALE, it must use Form 1095-B, Health Coverage, and transmittal Form 1094-B, Transmittal of Health Coverage Information Returns, to report minimum essential coverage.<\/p>\n
For 2026 plan years, the affordability percentage increases to 9.96%, up from 9.02% for 2025 plan years. Employers use this percentage to check whether the health coverage they offer is affordable. The result may affect the codes reported on Form 1095-C filed in 2027.<\/p>\n
Each ALE member has to file Form 1095-C for every employee who was a full-time employee for at least one month during the calendar year. If you’re part of an aggregated or controlled group, each ALE member is responsible for filing separately under its own EIN.<\/p>\n
The self-insured employer 1095-C rules go a step further. Self-insured ALEs must also report individuals enrolled in their coverage, which can include certain employees who weren’t full-time throughout the year.<\/p>\n
Form 1095-C is divided into three parts:<\/p>\n
| Part<\/th>\n | Information Reported<\/th>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Part I<\/td>\n | \n
|