The ABCs of healthcare tax forms

NUVISION Financial Corporationtony_wilson
As the rollout of the Affordable Care Act continues to unfold, taxpayers need to be prepared for a number of forms that are required when filing taxes this year. In particular, taxpayers should look for forms 1095-A, 1095-B and 1095-C that are used to show the taxpayer had medical coverage this past year, either through their employer or the Marketplace/Exchange. Below is a brief overview of what these three forms are and what needs to be done with them.

Form 1095-C The IRS requires large group employers (those with 50 or more full-time employees, including full-time equivalents, in the previous year) to provide eligible employees and the IRS with a 1095-C. The 1095-C will report information about individuals who had minimum essential coverage under the employer plan and therefore are not liable for the individual shared responsibility payment (penalty) for the months that they were covered under the qualifying plan. Employees who were eligible for the large group employer’s plan but declined or waived coverage also will receive a 1095-C reporting the declination/waiver.

Eligible employees should receive a 1095-C from each large group employer they worked for in 2015. Large group employers must furnish the 1095-C to eligible employees by March 31, 2016. The original deadline was February 1.

Form 1095-B Health insurance issuers and carriers are required to provide individuals Form 1095-B to report certain information to the IRS and to taxpayers about individuals who are covered by minimum essential coverage and therefore aren’t to pay any penalty.

Taxpayers should also receive a 1095-B from each health insurance issuer or carrier they were covered by in 2015 by March 31.

Note that employers with self-insured medical plans should issue a 1095-C to eligible employees by the deadline, not a 1095-B. In this case the 1095-C will include information combined from both forms.

Form 1095-A Form 1095-A is used to provide information to the IRS about those who enrolled in a qualified health plan through the Health Insurance Marketplace (Exchange). This form also is furnished by the Marketplace/Exchange to individuals to allow them to take the premium tax credit, to reconcile the credit on their returns with advance payments of the premium tax credit (advance credit payments), and to file an accurate tax return.

Individuals and families will only receive a 1095-A if they were covered by a Marketplace/Exchange plan at any point during 2015. Statements should have been furnished to taxpayers by Feb. 1.

Note that employees covered by a Small Health Options Program (SHOP) plan will receive a 1095-B instead of a 1095-A. Although the SHOP is a Marketplace/Exchange plan, the IRS requirement is the issuance of a 1095-B.

Small business owners — those with less than 50 FTEs, including FT equivalents — are NOT required to provide their employees with a 1095-C. Employees of small group employers must rely on the 1095-B from the appropriate source(s) to prove qualifying coverage and avoid the individual mandate penalty.

For 2015 the penalty is $325 per adult and $162.50 per child (up to $975 for a family) or 2 percent of household income above the tax return filing threshold for your filing status – whichever is greater.

Individuals and families covered by a Marketplace/Exchange plan must rely on the 1095-A to prove qualifying coverage and avoid the individual mandate penalty, unless covered by a SHOP plan.

While Form 1040 (Line 61) and Form 1040EZ (Line 11) ask about the filer’s “Health care: individual responsibility,” employees/individuals are not required to file the 1095-A, 1095-B or 1095-C with their tax returns. Self-filers would need to simply answer the question appropriately and maintain the forms with their important records should this information be needed in the future to prove qualifying coverage.

Those who work with a third party to file their taxes may find the tax preparer asking for the forms in order to complete the tax return. Individuals should be prepared to provide the tax preparer with the appropriate forms if the individual has received the forms from the appropriate source(s). However, with the issuance deadline for the 1095-B and 1095-C being pushed to March 31, it is possible an individual will want to file their tax return prior to receiving the ACA reporting forms. In this case, tax preparers should work with individuals to complete the tax filing process. Upon receipt of the forms the individual should maintain this information with their important records.

Recent Articles:

Follow Antares CPAs:

Succession & Transition Strategies

Creating a successful succession plan is about protecting the future of a business and/or brand and ensuring there is a strategy in place to ensure your business continues to thrive.

After years of investing time, money and other resources, it’s imperative to prepare for this next stage in business and life. Poor planning can increase risks for stakeholders and tarnish legacies. Let’s make sure the next generation is well-equipped and ready to take your life’s work and family legacy to an even greater level of success.

Each situation is unique because the needs of each one involved are unique. We carefully review each opportunity to determine how best to structure a transition while meeting your goals, complying with any brand licensing polices and minimizing the tax implications of the transfer.

  • Next generation succession planning
  • Retirement planning
  • Wealth management

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com

Technology Services

Antares Group’s technology team provides convenient hardware and software support, along with comprehensive cloud accounting services with 24/7 access to up-to-date financial information exactly the way you want it, on any connected device, with a customizable dashboard interface. We use best-in class cloud accounting platforms and software including Sage Intacct, Bill.com and robot process automation (RPA) with integration capabilities with some of the leading point-of-sale, payroll, and business operations management software programs.

Cloud accounting is just the beginning; Antares Group’s experienced technology team also performs system evaluations and makes recommendations for products and services that will help your business run more efficiently, as well as protecting your information and infrastructure with robust security options. Using the right technology for automation will simplify your life and keep your valuable data safe..

  • Technology and security optimization
  • Complete cloud accounting services
  • Computer troubleshooting assistance with remote and onsite repair

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com

Business Planning & Valuation

An accurate understanding of your company’s current value and financial viability is vital for achieving business success and the launch pad to boundless possibilities in the years to come. Realistic valuations are essential for long-term strategic plans, business successions and expansions, gift and estate planning, and a lucrative retirement package. Planning for where you want to go in the future is what our business and tax advisors do best. Whatever your goals, we are here to provide you with the right plan and insightful guidance to achieve it.

  • Trend reporting and analysis and business valuation
  • General business and start-up consulting
  • Major reinvestment planning
  • Cash flow projections

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com

Back Office Solutions

In such a fast-moving business environment, business owners need every advantage to succeed. Improving efficiency should be an ongoing part of your strategy for financial success, empowering you to make continuous improvements.

Whether your business is a single location seeking to grow effectively and sustainably, an established franchise brand adding new locations, or something in between, Antares Group provides a suite of back office services and the financial expertise to help business owners and managers achieve their operational and financial goals. In the process of supporting your essential back office operations with practical solutions, we analyze the function and effectiveness, looking for inefficiencies and potential liabilities, offering valuable insights for owners and managers.

  • Daily deposit verification and online banking monitoring
  • Process invoices and code general ledger accounts
  • Process vendor payments and file 1099s
  • Prepare and file sales and use tax returns
  • Reconcile bank, credit card and cashless sales accounts

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com

Tax Advisory

Minimizing your tax burden is a year-round strategy; planning for and preparing complex business and individual tax returns is where Antares Group excels. Beyond simply helping you fulfill basic tax obligations, you can rely on our tax advisory team to keep you informed of ever-changing regulations and keep you in compliance. We conduct regular reviews to make sure all methods of reducing your tax liabilities are being used. We routinely assess your personal income tax situation and cash flow to guard against the unexpected. This ongoing strategic analysis empowers you to maximize tax savings and capitalize on new opportunities.

In addition, we provide advisory services for new business startups, acquisitions, and dispositions. Through careful analysis, we help clients determine the best structure and make the process as seamless as possible.

  • Business and individual year-end tax returns
  • Personal property, gift, and trust income tax returns
  • Fixed asset setup and maintenance
  • Annual tax planning and preparation

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com

Cloud Accounting

Whether you run a small closely held business or a large franchise operation, maintaining a firm grasp of accounting and bookkeeping can be challenging. Between managing staff and overseeing daily operations, there is not enough time to dig into the books and make sense of the financials. You need to know the facts and the implications. – having precise, up-to-date information at hand means you always know your financial position so you can make informed decisions that keep your business moving forward.

The financial experts at Antares can create a custom menu of accounting and tax services perfectly catered to your business needs, including accurate and timely financial statements and reports, so you are always prepared to respond quickly to changing and challenging circumstances. Along the way, we provide clear feedback and financial guidance to help you predict trends and recognize issues, then make the necessary adjustments to sustain cash flow throughout the year.

  • Timely preparation of financial statements based on your particular needs
  • Complete preparation of sales, payroll, inventory, accrual, and prepaid journal entries
  • Meticulous monthly bank and credit card reconciliations

Let's get started.

Call us at 770.785.7855 Or email hello@antaresgroupcpas.com