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IRS Releases Draft Instructions for Affordable Care Act Compliance

Aren’t you glad that Affordable Care Act (ACA) reporting isn’t official until 2015? The IRS released drafts of 1095 forms in late July. At that time, there was concern about the instructions.

The IRS is encouraging employers to treat 2014 as a trial run for ACA filing. The draft of instructions for form 1095-C is now available.

What do I need to know about these instructions?

Your filing requirements depend on your situation. 

Are you a large employer, according to the ACA? If so, you will report on form 1095-C. This form reports the offer of health coverage given to your employees.

Are you, the employer, also the insurer? If so, the information that insurers file on form 1095-B should be filed with form 1095-C.

What else is in the instructions?


As you may have heard, the ACA is a very lengthy document. As an employer, many of the pages are not applicable to you. What is applicable? The instructions included in the ACA define specific terms. If you are unfamiliar with the ACA, this list of definitions is a good place to start your filing. Familiarizing yourself with the terminology used will help you stay compliant.

Transition relief eligibility
The IRS recognizes the mayhem the new ACA requirements may cause. The IRS offers different types of transition relief. The type of relief depends on the number of insured full-time employees. The employer should offer health coverage to at least 70% of full-time employees. 

The IRS provides transition relief for:
  • Certain arrangements that do not offer health coverage for dependents
  • Employers with non-calendar year plans
  • Health coverage in January, 2015
Eligibility for each type of relief varies, as does the relief provided. For example, the IRS may not assess penalties for smaller employers in 2015. Of course, this depends on IRS-determined eligibility. View the IRS instructions if you think you may qualify.

Filing 2014’s information is voluntary. There will likely be some kinks in this year’s filings. Taking this year as a test run may be a good strategy to reduce risk of penalties in the following years. Visit to get started.