The good news is that employer ACA reporting was delayed for 2014. The bad news is that your employees may be prompted for the new Form 1095 when they file their taxes for 2014. The Form 1040 will prompt filers to indicate whether they had health care coverage in 2014. While a recent press release from the Departments of Treasury and HHS states that, for many with employer-sponsored health insurance, indicating coverage status will be as easy as "checking the box," what makes it more complicated is the taxpayer documentation required in order to "check the box" and/or have on file in the event of an audit later.
Employer messaging with W-2 distribution could prevent employee calls to the payroll and benefits department during tax filing season. To start with, let employees know they may be asked for a 1095 and let them know this was a requirement the government delayed for employers until next year. Then you might suggest what they could use to document their coverage. Here are a few ideas:
- End-of-the-year payroll stub with health insurance deduction information.
- Health insurance ID card.
- Copy of the summary plan description (SPD).
- Enrollment confirmation statement from open enrollment for 2014 (you have yours, right?).
- Exchange Notice (if you completed Part B: Information About Health Coverage Offered by Your Employer)
You might also consider adding a similar message to the benefits and payroll pages on your online systems where employees might go in search of a 1095.
Advance preparation and communications could reduce calls and emails for HR staff, and help employees avoid additional stress during tax season.