1 Introduction to Affordable Care Act Health Coverage Returns (AIR)

This chapter contains the following topics:

1.1 Overview

This guide describes how to perform year-end tasks for producing Affordable Care Act (ACA) Health Coverage Information Returns, including data preparation and setup, generating and working with reporting information, printing forms and reports, and electronic filing.

Oracle JD Edwards enables users to refer to information in existing Payroll and Human Resources tables in order to create the data required for reporting.

The Affordable Care Act Health Coverage Information Returns (AIR) presents a unique set of reporting requirements to employers. All Applicable Large Employer (ALE) Members are required to file Forms 1094-C and1095-C for 2019.

Employers with 50 or more full-time employees (including full-time equivalent employees) in the previous year, should use Forms 1094-C and 1095-C to report the information required under sections 6055 and 6056 of the Internal Revenue Code about offers of health coverage and enrollment in health coverage for their employees.

Form 1095-C is used to:

  • Provide printed information for full-time employees to use when filing their tax returns.

  • Report information about health insurance coverage offered and any safe harbors or other relief available to the employer, or report that no offer of coverage was made.

  • Report enrollment information from employers who offer self-insured plans, and information about employees and individuals who enrolled in minimum essential coverage.

  • Help the Internal Revenue Service (IRS) determine if your organization potentially owes an employer shared responsibility payment to the IRS.

  • Help the IRS determine whether your full-time employees and their dependents are eligible for the premium tax credit.

Form 1094-C is used to:

  • File with the IRS as a transmittal document for Forms 1095-C, Employer Provided Health Insurance Offer and Coverage Information Returns.

  • Provide a summary to the IRS of aggregate employer-level data.

  • Help the IRS to determine whether an employer is subject to an employer shared responsibility payment and the proposed payment amount.

1.2 ACA Health Coverage Information Returns (AIR) Features

US Affordable Care Act (ACA) year-end processing includes the following features:

  • Flexibility

    Flexible setup for establishing IRS reporting codes, and processing that considers offer and coverage with or without benefits administration enrollment data.

  • Control over reporting

    Review and reset workfiles before producing forms. Edit, add to, or import data to the reporting workfiles before producing the final forms.

The system supports the following ACA year-end forms:

  • 1094-C Transmittal of Employer Provided Health Insurance Offer and Coverage Information Returns

  • 1095-C Employer-Provided Health Insurance Offer and Coverage

These ACA year-end forms serve as important documents for employees, employers, and the IRS.

1.3 Release Levels

The software for processing U.S. ACA year-end information is available for JD Edwards World release A9.4 and A9.3.1.

1.4 ACA Information Returns Processing for 2019

All ALE Members are required to file Forms 1094-C and 1095-C for 2019. Final forms and form instructions are available on the IRS website at

https://www.irs.gov/forms-pubs

1.4.1 Who Must File Forms 1094-C and 1095-C

ALEs (generally employers with 50 or more full-time employees (including full-time equivalent employees)) in the previous year, must file Form 1095-C for each full-time employee for any month of the calender year. Generally, the employer is required to furnish a copy of the Form 1095-C (or a substitute form) to the employee.

Each employer has their own reporting obligation related to the health coverage that they offered (or did not offer) to each of their full-time employees. Generally, an employer is subject to employer shared responsibility provisions under section 4980H when they have 50 or more full-time employees, including full-time equivalent employees, during the prior calendar year.

An employer that offers health coverage through an employer-sponsored self-insured health plan must complete Form 1095-C, Parts I, II, and III, for any employee who enrolls in the health coverage, whether or not the employee is a full-time employee for any month of the calendar year. If the employee who enrolled in self-insured coverage is a full-time employee for any month of the calendar year, the employer must complete Part II (in addition to Parts I and III). If the employee who enrolled is not a full-time employee for any months of the calendar year (which means that for all 12 calendar months the employee was not a full-time employee), the employer must complete Form 1095-C, Parts I and III and on Part II, must enter code 1G on line 14 in the All 12 Months column or in each separate monthly box (the employer need not complete Part II, lines 15 and 16 in this case).

If an employer is offering health coverage to employees other than under a self-insured plan, such as through an insured health plan or a multi-employer health plan, the issuer of the insurance or the sponsor of the plan providing the coverage is required to furnish the information about their health coverage to any enrolled employees, and the employer should not complete Form 1095-C, Part III, for those employees.

An employer that offers employer-sponsored self-insured health coverage but is not an ALE subject to the employer shared responsibility provisions under section 4980H, should not file Forms 1094-C and 1095-C.

You should submit Form 1095-C for:

  • Employees who were full-time for any month of the year

  • Employees who enrolled in self-insured coverage, regardless of their full-time status

  • COBRA participants and retirees to cover under a health coverage plan

1.4.1.1 Authoritative Transmittal for Employers Filing Multiple Forms 1094-C

Each original submission to the IRS contains one Form 1094-C and a number of Form 1095-Cs. An employer may create as many submissions as required. If an employer creates multiple submissions (files multiple Forms 1094-C and accompanying Form 1095-Cs), one submission must contain an Authoritative Transmittal 1094-C, containing the summary information for the employer.

Note:

A Form 1094-C designated as an Authoritative Transmittal can be identified on Line19, Part I of Form 1094-C.

1.4.2 When to File Forms 1094-C and 1095-C

You need to meet the requirements to file Forms 1094-C and 1095-C, and verify if the forms are properly addressed and mailed on or before the due date. If the regular due date falls on a Saturday, a Sunday, or a legal holiday, file by the next business day. A business day is any day that is not a Saturday, a Sunday, or a legal holiday.

You must distribute Form 1095-C to employees by January 31 of the year following the calendar year to which the return relates. JD Edwards currently supports only paper distributions to employees.

Generally, you must file Forms 1094-C and 1095-C with the IRS by February 28 if filing on paper (or March 31 if filing electronically) of the year following the calendar year to which the return relates. For calendar year 2019, Forms 1094-C and 1095-C are required to be filed with the IRS by February 28, 2020, if filing on paper, or March 31, 2020, if filing electronically.

If you are required to file 250 or more information returns, you must file electronically. The electronic filing requirement does not apply if you apply for and receive a hardship waiver. The IRS encourages you to file electronically even if you are filing fewer than 250 returns.

Note:

JD Edwards does not support paper filing of information returns to the IRS.

1.4.3 How to File Forms 1094-C and 1095-C

This guide describes how to electronically file Forms 1094-C and 1095-C with the IRS. Once the workfiles have been built and reviewed, you will produce paper Form 1095-Cs for sending to recipients. Then, prepare the XML files to transmit to the IRS through the ACA Information Returns (AIR) System web portal.

The Internal Revenue Service (IRS) strongly encourages the quality review of data before filing, to prevent erroneous notices from being mailed to statement recipients (or others for whom information is being reported).

1.4.4 Furnishing Paper Form 1095-Cs to Recipients

You should meet the requirement to furnish Form 1095-C to an employee if the form is properly addressed and mailed on or before the due date. If the regular due date falls on a Saturday, a Sunday, or a legal holiday, file by the next business day. A business day is any day that is not a Saturday, a Sunday, or a legal holiday.

Generally, an employer must furnish a Form 1095-C to each of its full-time employees by January 31 of the year following the year to which the Form 1095-C relates.

1.4.4.1 Correcting Paper Form 1095-Cs Furnished to Recipients

If you want to make corrections to the Form 1095-Cs that were distributed to employees or other recipients before they are submitted to the IRS, you may make changes to the original Form 1095-C records in the system and reprint the forms for distribution to employees. Do not mark the CORRECTED box, instead, write the word Corrected on the paper form. These records will still be considered original when submitted to the IRS.

1.4.5 Transmitting Forms 1094-C and 1095-C to the IRS

Affordable Care Act Information Returns (Forms 1094-C and 1095-C) must be filed using the Affordable Care Act Information Returns System (AIR). The transmission of returns must be in the defined XML format within the 100 MB limit.

Ensure that the registration, TCC application, and pre-filing activities are complete. To use the AIR system, you must apply for and receive a Transmitter Control Code (TCC), and pass a one-time communication test. The TCC application is available on https://www.irs.gov/. See the IRS publications 5164, 5165, and the IRS AIR program for more information.

1.5 Preparation for AIR Year-End Reporting

The following information helps you determine how to prepare for year-end reporting.

1.5.1 Deadline Information

Generally, you must file Forms 1094-C and 1095-C by February 28 of the year (if filing on paper) or March 31 of the year (if filing electronically), following the calendar year to which the return relates. For calendar year 2019, Forms 1094-C and 1095-C are required to be filed by February 28, 2020, or March 31, 2020 (if filing electronically).

Deadline Extensions and Waivers of Reporting Requirements

You can get an automatic 30-day extension of time to file by completing Form 8809 (Application for Extension of Time To File Information Returns).

To receive a waiver from the required filing of information returns electronically, submit Form 8508. You can request for Waiver From Filing Information Returns Electronically at least 45 days before the due date of the returns. You cannot apply for a waiver for more than one tax year at a time. If you need a waiver for more than one tax year, you must reapply at the appropriate time each year.

1.5.2 Government Regulations

JD Edwards World believes the IRS information that is included for your reference in this guide to be accurate as of the date of its publication; however, you should not rely on it as your sole source of information when filing reports or returns with the IRS. You should refer to the appropriate IRS publication or regulation for authoritative information and for guidance about filing requirements.

Note:

Before you can correctly adhere to IRS Information Returns reporting requirements, you must understand the IRS legislation and form instructions, the responsibilities, and the potential liabilities. Customers should be familiar with and understand ACA legislative requirements, and refer to their legal counsel or other advisors for guidance.

1.5.3 Supported Forms

The JD Edwards World system supports Form 1094-C Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns and Form 1095-C Employer-Provided Health Insurance Offer and Coverage applicable to ALEs. Forms 1094-B and 1095-B apply to insurance providers and are not supported by the JD Edwards World system.

1.5.4 Filing Paper Forms with the IRS

If you are filing your returns on paper, see Pub. 5223 for specifications about private printing of substitute information returns. You may not request special consideration. Only forms that conform to the official form and the specifications in Pub. 5223 are acceptable for filing with the IRS.

Note:

JD Edwards does not support paper filing of health coverage returns with the IRS, and therefore does not support a printed Form 1094-C or 1095-C for filing to the IRS. JD Edwards does support the printing of Form 1095-C for recipients.

1.5.5 Electronic Filing of ACA Information Returns

After the Form 1095-Cs have been printed and the 1094-C Build Employee Counts have been run, go to menu G08ACAEF. Select Work with 1094-Cs, select the unsubmitted 1094-Cs for inclusion in a transmission, and then request a transmission build. The transmission build creates the XML Form Data file and XML Manifest file. You can transmit these files to the IRS through the AIR System Web Portal. You must record the Receipt ID and submission date returned in the Web Portal on the transmission record. Once the file is processed, the IRS displays a transmission status. You must record the transmission status on the transmission and possibly the submission records.

Prerequisites

Before you file the ACA Information Returns electronically, complete the following tasks:

  • Register a responsible official and your contacts for a login with IRS E-Services.

  • Apply for and receive a Transmitter Control Code (TCC).

  • Pass a communication test with the AIR system and receive confirmation that your TCC has been placed in production status.

For more information, see Section 6.4, "Creating and Reviewing Submitted or Transmitted Form 1094-C"

1.5.5.1 Registering for IRS e-Services

Employers who are the Transmitter (file ACA Information Returns electronically using the AIR system) must have at least one responsible official (and optionally, other contacts) who register personally with IRS e-Services. After making an application online, the registrant receives an IRS e-Services User ID and Password through the United States Postal Service (USPS) mail, which is required later to log into the AIR system.

1.5.5.2 Applying for a Transmitter Control Code

After receiving an IRS E-Services login, the responsible official must apply for a Transmitter Control Code (TCC). If you have multiple employers, one employer may act as the transmitter for all of your employers. When registering for a TCC, you must request the role of Transmitter and optionally the role of Issuer. Oracle JD Edwards World is registered with the role of Software Developer. The JD Edwards system is designed to use the AIR-UI Channel exclusively.

1.5.5.3 AIR System Communications Test

Once you have received your Transmitter Control Code, you must submit a one-time test transmission, called a communications test. This test verifies your ability to submit information returns with the AIR system. You utilize one of the test scenarios described in IRS publication 5164 - Test Package for Electronic Filers of Affordable Care Act (ACA) Information Returns (AIR). Your communications test must use your transmitter TCC and the Software Vendor ID for JD Edwards World, which is provided by Oracle JD Edwards. Your communications test must be Accepted or Accepted with Errors. Once the test transmission has been accepted, you call the IRS to verify the completion of the communications test and have them put your TCC in production status.

1.5.6 Correcting Accepted Form 1094-C and Form 1095-C

Corrections can only be made to previous submissions that have been Accepted or Accepted with Errors. Transmissions containing correction records must only contain corrections and should not include any Originals. The unique identifiers assigned by AIR allow corrections to the specific record(s), both transmittal records (Forms 1094) and information return records (Forms 1095). Corrections may be filed for the following form types:

  • Form 1094-C

  • Form 1095-C

1.5.7 Correcting Printed Form 1095-Cs Filed with the IRS

If making changes to paper Form 1095-Cs that were previously filed with the IRS, you will make changes to the 1095-C records in the JD Edwards system and reprint them. You must manually mark the CORRECTED box with an X.

Note:

JD Edwards does not support filing paper Forms 1094-C and 1095-C with the IRS.

1.5.8 Transmission or Submission Definitions and Limitations

An AIR system transmission using the UI Channel consists of one XML Form Data file and one XML Manifest file. Transmissions:

  • Consist of one or more submissions

  • Must not contain submissions of different types (must not have both Forms 1094-B or 1095-B and Forms 1094-C or 1095-C in the same transmission)

  • The Form Data file may not exceed 100 MB of uncompressed native XML.

  • A transmission must not mix Original and Corrected submissions.

Submissions:

  • Consist of one 1094-C and zero or more 1095-Cs.

  • The reported number of information returns on the 1094-C transmittal form must match the actual number of information returns.

  • If a transmission or submission is larger than 100 MB, the batch transmission build program automatically breaks up the transmission into two or more transmissions in the following way:

    • The first submission consists of the Forms 1094-C and as many Forms 1095-C as will fit within the 100 MB limit

    • The subsequent submission(s) will include Forms 1094-C, and as many associated Forms 1095- C as can be contained without exceeding the 100 MB size limit.

1.5.9 Submitting Records to the IRS

The transmission or submission process results in several different outcomes based on the data transmitted.

A submitted record requires formal correction if the Submission Status on the Submission record (SUIRSS in the file F08212) for the 1094-C is one of the following:

  • A: Accepted

  • E: Accepted with Errors

If submitted, but the status of the submission is blank, no change or delete is allowed because the transmission or submission is in progress.

1.5.10 IRS Resource List

To obtain the forms and for the latest information about developments related to Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, and instructions, such as legislation enacted after they were published, go to https://www.irs.gov/uac/about-form-1094-c and https://www.irs.gov/uac/about-form-1095-c.

You can also access Forms 1094-C and 1095-C instructions on the IRS website at https://www.irs.gov/pub/irs-pdf/i109495c.pdf. This document includes instructions for both forms as well as references to several other IRS resources and websites.

1.6 The AIR Year-End Processing Cycle and Process Flow

This section discusses:

  • AIR Year-End processing checklist

  • AIR Year-End process flow

1.6.1 AIR Year-End Processing Cycle

To process AIR year-end information, use the following checklist:

Task Corresponding Documentation and Information
Install the update You must install the update to run year-end ACA programs.

This guide does not include software installation instructions and the necessary program-specific instructions (ASIs).
Verify company setup If you have multiple companies with the same Tax ID, you have to designate which one is the parent. The parent is then considered the reporting company. The reporting company should be in the Company Constants (G0541/2) and the Company Names and Fiscal Dates (F15 from G0541/2). You have to designate which company is the reporting company by utilizing the Parent Address field in the fold on the Corporate Tax IDs (G0541/5).
Verify employee setup.

Verify the format of employee names and addresses in the Address Book system to ensure that the information you report to the government and to the employees is accurate.

 Note: If employee names are not formatted correctly, government reporting agencies might not accept the year-end information that the organization submits. You might have to run the Address Book Who's Who file (F0111) Conversion program on menu G06UDM to ensure that all employee names are formatted correctly.
Set up base data.

  • Set up ALE ID to Home Company Cross-Reference.

  • Verify employee ACA eligibility data.

  • Verify benefits enrollment information.

  • Set up Employee Offer and Coverage information.

  • Set up Manifest Information

 Chapter 2, "Setting Up AIR Year-End Processing"
Generate preliminary workfiles.

  • Periods of Employment Build

  • Hours Worked by Month Build

 Chapter 3, "Generating ACA Health Coverage (AIR) Preliminary Builds and Reports"
Build AIR Year-End workfiles.

  • 1095-C Offer and Coverage workfile

  • 1095-C Covered Individuals workfile for self-insured plans

  • 1094-C Transmittal Workfile

 Chapter 4, "Setting Up ACA Information Returns Workfiles"
Review and validate workfile information online and with printed reports. Chapter 5, "Reviewing ACA Information Returns (AIR) Workfile Information"
Print forms.

Print Form1095-C for distribution to form recipients.

Build Form Data XML file (containing the Forms 1094-C and 1095-C information) and the accompanying Manifest XML file for transmission.

Upload transmission XML files to the IRS.

 Chapter 6, "Producing AIR Year-End Deliverables"

1.6.2 AIR Year-End Process Flow

This diagram illustrates the process workflow of AIR year-end information:

Figure 1-1 AIR Year-End Process Information Workflow

Description of Figure 1-1 follows
Description of ''Figure 1-1 AIR Year-End Process Information Workflow''