IRS Extends Employers’ Affordable Care Act Reporting Deadline, Provides Taxpayers with Relief when Filing 2017 Tax Returns by Adam Cohen, CPA

Posted on January 18, 2018 by Adam Cohen

Despite a repeal of the individual insurance mandate that is included in the Tax Cuts and Jobs Act that went into effect on Jan. 1, 2018, U.S. taxpayers will still need to meet their 2017 Affordable Care Act reporting requirements on the tax returns they file this April.

However, the IRS has reversed its earlier decision to reject electronically filed returns that do not indicate whether or not the taxpayer had health coverage during the year. Therefore, taxpayers may indeed file their 2017 tax returns before the April 16, 2018, filing deadline without checking the “full-year coverage” box on Form 1040.

This development is due to the IRS’s decision to extend by 30 days the 2018 due date for some entities to provide 2017 health coverage information forms to their employees. Insurers, self-insuring employers, other coverage providers and applicable large employers now have until March 2, 2018, to provide to their workers Forms 1095-B, Health Coverage, and 1095-C, Employer-Provided Health Insurance Offer and Coverage Forms, which summarize the insurance they offered or did not offer to employees in 2017.

Notwithstanding this extension of time to share information with employees, employers will still need to meet their responsibilities to electronically file informational returns with the IRS by the April 2 deadline (or February 28 for paper filers) via Forms 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and 1095-C, Employer-Provided Health Insurance Offer and Coverage.

As a reminder, employers that do not meet their 2017 ACA reporting requirements may be subject to a penalty as high as $3.193 million, depending on their gross sales and when they correct or make a final informational return filing. Similarly, individual taxpayers who failed to have minimum essential health care coverage for any month in 2017, or who did not meet one the exceptions from the law, will be subject to the ACA’s individual mandate shared responsibility penalty, which is the greater of 1) 2.5 percent of a household’s modified adjusted gross income (MAGI) above the filing threshold or 2) a payment equal to $695 per adult and $347.50 per child with a maximum amount per family of $2,085.

About the Author: Adam Cohen, CPA, is an associate director of Tax Services with Berkowitz Pollack Brant, where he works with closely held businesses and non-profit charities, hospitals and family foundations to maintain tax efficiency and comply with federal and state regulations. He can be reached at the CPA firm’s Ft. Lauderdale, Fla., office at (954) 712-7000 or via e-mail at