Understanding the New ACA Reporting Relief for Employers

At the close of last year, we highlighted the introduction of new legislation that offers employers some relief in Affordable Care Act (ACA) reporting duties. The Paperwork Burden Reduction Act now allows applicable large employers (ALEs) to forego automatically distributing Form 1095-C to employees. Instead, ALEs are simply required to inform employees they can request this form through a 'clear and conspicuous notice.' Recently, the IRS released Notice 2025-15, providing clarity on what constitutes such a notice.

Key Elements of Notice 2025-15

The Notice outlines specific conditions ALEs must meet if they wish to provide a notice instead of the automatic distribution of Form 1095-C:

• The notice must be accessible to any individual for whom a 1095-C is filed, including current and former employees like COBRA enrollees and retirees.
• Contact information—an email address, physical address, and phone number—must be provided for individuals to request their Form 1095-C or raise inquiries.
• The notice should use plain, non-technical language, and font size sufficiently large to draw attention to its importance regarding Form 1095-C.
• It must be posted on the website by the Form 1095-C due date, which includes the 30-day extension. For the 2024 forms, that date is March 3, 2025.
• The notice should remain visible on the website until October 15 of the following year, making the deadline for 2024 forms October 15, 2025.

Example of a Compliant Notice

To ensure compliance, ALEs can include a 'Tax Information' link on their main web page that leads users to a separate page. This secondary page should prominently display 'IMPORTANT HEALTH COVERAGE TAX DOCUMENTS,' accompanied by instructions to request Form 1095-C and providing relevant contact information including an email, mailing address, and phone number.

Additional Requirements and Recommendations

The Notice also states that ALEs must supply a requested Form 1095-C within 30 days, and it may be provided electronically with the employee's consent.

Even under this relief, ALEs must still file Forms 1094-C and 1095-C with the IRS by March 31, 2025, if filing electronically, or by February 28, 2025, if using paper. Employers looking to reduce costs associated with mailing Form 1095-C should consider posting a compliant notice as outlined. It’s important to note that this relief applies only at the federal level; employers should verify state-level requirements, especially in states like California with separate reporting.