Do you need to file 1095 forms with the State of California?
Last year, California passed the Minimum Essential Coverage Individual Mandate. Health coverage will be reported on tax returns and individuals may see a penalty if they did not obtain minimum essential coverage (MEC) for each month of 2020.
Insurance providers are required to report health coverage information annually by March 31. Employers are similarly required to report insurance information by March 31, but only if their insurance providers do not report to the Franchise Tax Board (FTB).
Self-Insured CA Employers
This means self-insured employers who provide coverage to California residents will need to file 1095-C forms with the state. Additionally, self-insured employers must distribute 1095-C’s to employees by January 31 (even though the Federal deadline was extended to March 2, the FTB has not changed their deadline). The earlier deadline for furnishing the 1095-C form to employees only applies to self-insured employers.
1095-C forms may be filed with the FTB on paper or electronically. Electronic filing is required if you are filing over 250 forms. You are only required to file forms for employees that enrolled in the self-insured coverage provided by your company. It is not necessary to file forms for employees that did not enroll in coverage.
How To Prepare
To prepare for this reporting requirement, applicable employers should register for the Minimum Essential Coverage Information Reporting Program (MEC IR) at ftb.ca.gov/mec .
This process is similar to the registration with the IRS for 1095-C electronic reporting. A responsible official authorized to file the 1095-C’s on behalf of the company must complete the registration process.
As with federal 1095-C reporting, California requires a test file be submitted. We will have more details on the process of submitting a test file in a future blog post.
If your company is not an Applicable Large Employer (ALE) under the federal Affordable Care Act rules but it is self-insured, the California reporting requirement does apply to your company. In this situation, you may be required to complete the 1095-B form (which you should already be doing), not the 1095-C form.
The HR program only prepares a 1095-C form. You should be able to simply submit copies of the 1095-B forms on paper to the state to fulfill this requirement.
Click here for more information and filing instructions.
We will update customers on this blog as soon as we have more information and program updates available.