KNOW YOUR BENEFITS –
Forms 1095-B and 1095-C and what you need to know
With the Affordable Care Act came various reporting requirements for both employers and employees that require most Americans to have health coverage. For an employer to show that they provided coverage, if that employer was required to offer coverage and is considered an applicable large employer, employers must report this coverage offer to the Internal Revenue Service (IRS) annually. For taxpayers to show they had coverage, when we file IRS tax returns (either federal or state), you also report your insurance status at that same time. Depending on whether you are an employer or an employee, these reporting requirements can be confusing. Team WISG is here to assist our employer groups with their reporting requirements and can also assist individual members with understanding the 2020 tax documents you receive.
In early 2021, we start to receive tax forms from various sources. Specific to health insurance, many will receive forms 1095-B and 1095-C if you were enrolled in an employer’s health plan during 2020. In most cases, 1095-B forms will be sent to you by your health insurance company, while your employer will send you Form 1095-C. However, in some cases, you may receive only one combined form, provided by your employer, if that employer runs a self-funded health plan.
You do not file these forms with your tax return as they are informational only. However, it is important that you save these forms because they provide key information about your health coverage and can help you when filling out your tax return.
Form 1095-B: This form provides information about the offer of health insurance coverage. This form contains information on which of your tax dependents were covered by this health plan and which months you and any covered dependents had coverage. Only one copy of Form 1095-B will be provided for all your covered family members. Spouses and dependents who received coverage under your plan in 2020 will not receive their own forms. If necessary, you may provide copies of the form to your spouse and dependents for their own records, if they file tax forms separately from you.
Form 1095-C: This form provides proof of the health insurance coverage your employer offered to you and your family during the 2020 tax year, if any. This form contains the following information: whether coverage was offered to you, your spouse, and your dependents, and includes what you would pay for the lowest monthly premium for self-only coverage offered to you in 2020. Keep in mind that this rate may not be what you are paying if you have multiple plans available to you, and you purchased a more expensive plan, other than this “base” plan. This form will be provided to you if you were a full-time employee in 2020, regardless of whether you opted to enroll in health insurance coverage through your employer or not.
Filing Your 2020 Tax Return: the information provided on these forms can help you complete your tax return. Once your tax return is filed, save the forms for your records. The IRS will receive their own copy of each of the forms for comparison purposes. If you obtained health insurance coverage from more than one employer in 2020, you would receive separate forms 1095-B and 1095-C from each employer and health insurance company that offered or provided coverage.