In December 2024, the Biden administration enacted two significant laws to simplify Affordable Care Act (ACA) reporting requirements for employers:
1. Paperwork Burden Reduction Act (PBRA):
- On-Request Furnishing of Forms 1095-B and 1095-C: Employers and insurers are no longer mandated to automatically distribute Forms 1095-B and 1095-C to employees. Instead, these forms must be provided only upon an employee’s request.Notice Requirement: To utilize this provision, employers must offer a “clear, conspicuous, and accessible notice” informing employees of their right to request these forms. The IRS may issue further guidance on the specifics of this notice.
Timely Response to Requests: Upon receiving a request, employers are required to furnish the requested form by the later of January 31 of the year following the reporting year or 30 days after the request.
2. Employer Reporting Improvement Act (ERIA):
- Electronic Delivery with Consent: This act codifies existing IRS regulations, allowing employers to deliver Forms 1095-B and 1095-C electronically, provided they obtain the individual’s consent. This change is effective for forms due after December 31, 2024.
- Use of Date of Birth in Place of TIN: ERIA permits employers to use an individual’s date of birth as a substitute for their Tax Identification Number (TIN) when the TIN is unavailable, simplifying the reporting process.
These legislative changes aim to reduce the administrative burden on employers by streamlining the process of furnishing ACA-related forms to employees.