Who is required to submit ACA reporting?

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Applicable Large Employers (ALEs) and any employers offering self-insured health coverage, regardless of size, must file Affordable Care Act (ACA) reporting.

Who Must File

  • Applicable Large Employers (ALEs): Businesses that averaged 50 or more full-time employees (including full-time equivalent employees) during the previous calendar year must file. They use Forms 1094-C and 1095-C.
  • Self-Insured Employers of Any Size: Small employers with fewer than 50 employees who sponsor a self-insured (self-funded) health plan must file using Forms 1094-B and 1095-B.
  • Health Insurance Providers: Insurance carriers, rather than the employer, file reporting forms for fully insured plans covering small groups or individuals.

Key Reporting Requirements

  • Filing with the IRS: Required annually. If filing 10 or more total information returns (including W-2s and ACA forms), electronic filing is mandatory.
  • Furnishing to Employees: Copies of the respective 1095 forms must also be provided to full-time or covered employees.

Is ACA reporting mandatory?

Affordable Care Act (ACA) reporting is mandatory for applicable large employers and entities that provide self-insured health coverage.

Who Must Report

  • Applicable Large Employers (ALEs): Businesses with an average of 50 or more full-time equivalent employees in the prior year must file. They use IRS Form 1094-C and Form 1095-C.
  • Self-Insured Employers: Small employers that sponsor self-insured health plans must report coverage details under Section 6055 using IRS Form 1094-B and Form 1095-B.
  • Health Insurance Providers: Insurers and other providers of minimum essential coverage must also file annual returns.

Key Requirements

  • Electronic Filing: Mandatory for any organization filing a total of 10 or more information returns with the IRS.
  • Penalties: Failing to file accurate and timely returns can result in substantial IRS penalties per form.

Is ACA reporting still required for 2026?

Yes, Affordable Care Act (ACA) reporting is still required in 2026 for the 2025 tax year, and the mandate continues for applicable entities.

Who Must File

  • Applicable Large Employers (ALEs): Organizations with 50 or more full-time or full-time-equivalent employees during the prior calendar year must file.
  • Self-Insured Employers: Employers of any size that sponsor self-insured health plans must file coverage reports.

Key Requirements & Changes

  • Electronic Filing: E-filing via the Affordable Care Act Information Returns (AIR) system is mandatory if you file 10 or more return forms in aggregate.
  • Furnishing Forms: Employers must provide Form 1095-C or 1095-B to individuals, or utilize the alternative online notice availability option where permitted (though direct furnishing may still be required by certain states with individual mandates).
  • State-Level Reporting: States like California, New Jersey, Rhode Island, Massachusetts, and Washington D.C. maintain separate state-level health coverage mandates and distinct filing requirements.

Do I need a 1095-C to file my taxes in 2026?

No, you do not need the IRS Health Care Information Forms FAQ to file your federal income tax return.

What Is Form 1095-C?

  • It is an informational record sent by large employers.
  • It shows the health insurance coverage your employer offered you.
  • Employers with 50 or more full-time workers must provide this form.

Do You Need It to File?

  • No, the IRS does not require it to complete your taxes.
  • You do not need to wait for it to arrive before you file.
  • Do not attach it to your tax return.
  • Keep it in a safe place with your personal tax records.

When Do You Need a 1095 Form?

  • You only need Form 1095-A if you bought insurance through the government Marketplace.
  • Form 1095-A is required to report your premium tax credit.

How many employees do you have to have to file ACA?

You generally need 50 or more full-time or full-time equivalent employees (FTEs) on average during the prior calendar year to be required to file Affordable Care Act (ACA) returns.

Large Employers (50+ Employees)

Small Employers (Under 50 Employees)

  • Status: Generally exempt from standard ACA filing and offering mandates.
  • Exception: Small businesses that sponsor a self-insured health plan (or level-funded plan, or ICHRA) must still file IRS Forms 1094-B and 1095-B, regardless of how few workers they have.

ACA Reporting Requirements

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What is the penalty for not filing ACA reporting?

The penalty for failing to file accurate Affordable Care Act (ACA) information returns (Forms 1094-B/C and 1095-B/C) with the IRS or furnish statements to employees is generally $340 per return for recent tax years, doubling to $680 per return if there is intentional disregard.

Because penalties apply separately for failing to file with the IRS and failing to furnish the statement to the employee, the total exposure can reach $680 per employee.

Breakdown of Information Reporting Penalties

Penalties are adjusted for inflation annually and scale depending on how late the correction is made:

  • Standard Failure to File/Furnish: $340 per return (capped at roughly $4 million maximum per year for large businesses, and lower caps for small businesses with gross receipts under $5 million).
  • Corrected within 30 days: Reduced to $60 per return.
  • Corrected after 30 days but before August 1: Reduced to $130 per return.
  • Intentional Disregard: $680 per return with no maximum cap.

(Note: These reporting penalties are separate from the heavier "Employer Shared Responsibility Payment" pay-or-play penalties levied under Section 4980H if an applicable large employer fails to offer qualifying coverage).

Is there still an ACA mandate?

The federal individual mandate under the Affordable Care Act is still technically in the law, but the federal tax penalty for not having health insurance was reduced to $0 starting in 2019.

Federal vs. State Mandates

  • Federal Penalty: There is no longer a federal fine or tax penalty assessed by the IRS for being uninsured.
  • State Penalties: Several states and Washington, D.C., have enacted their own individual health insurance mandates with active state-level tax penalties.
  • States with Penalties: California, Massachusetts, New Jersey, Rhode Island, and Washington, D.C. require coverage or impose a penalty.
  • States with Reporting Only: Maryland and Vermont require residents to report their insurance status on state taxes, but they do not charge a penalty.

The Employer Mandate

  • The separate employer mandate—which requires businesses with 50 or more full-time employees to offer qualifying health insurance or pay a penalty—remains fully in effect at the federal level.

What are the deadlines for ACA reporting?

For the 2025 tax year reporting (filed in 2026), key federal Affordable Care Act (ACA) deadlines and requirements can be reviewed on the IRS ACA Information Center for ALEs.

Federal ACA Deadlines

  • Employee/Recipient Furnishing (Forms 1095-B / 1095-C): March 2, 2026 (or via an eligible web notice posted from March 2 through October 15, 2026, where forms are provided upon request).
  • IRS Paper Filing: March 2, 2026 (applies only to employers filing 10 or fewer total returns).
  • IRS Electronic Filing: March 31, 2026 (mandatory for employers filing 10 or more aggregate information returns).

State-Level ACA Reporting Deadlines

If you have employees residing in states with individual health mandates, separate state filing and furnishing deadlines apply:

  • California: Furnish to employees by January 31, 2026; state filing by March 31, 2026.
  • New Jersey & Rhode Island: Furnish to employees by March 2, 2026; state filing by March 31, 2026.
  • Massachusetts: Furnish and file Form MA 1099-HC by February 2, 2026.
  • Washington, D.C.: State filing by April 30, 2026.

What are the ACA codes required for 2026?

ACA reporting codes required for Form 1095-C are categorized into Series 1 (Line 14) to describe the offer of coverage and Series 2 (Line 16) to explain safe harbors and enrollment status.

Line 14 Codes (Offer of Coverage)

Line 14 codes tell the IRS what type of health coverage, if any, was offered to an employee, their spouse, and their dependents.

  • 1A: Qualifying Offer (Minimum Essential Coverage and Minimum Value offered to the employee, plus affordable coverage for spouse and dependents).
  • 1B - 1E: Various combinations of coverage offers to the employee, spouse, or dependents only.
  • 1F: Minimum Essential Coverage offered that was not Minimum Value.
  • 1G: Offer of coverage to a non-employee (such as a former employee on COBRA) for some or all of the year.
  • 1H - 1J / 1K: No offer of coverage, or specialized ICHRA (Individual Coverage Health Reimbursement Arrangement) offers.

Line 2 Series Codes (Safe Harbors & Exceptions)

Line 16 codes explain why an employee was not enrolled or indicate an affordability safe harbor.

  • 2A: Employee not employed during the month.
  • 2B: Employee not a full-time employee.
  • 2C: Employee enrolled in the coverage offered.
  • 2F, 2G, 2H: Section 4980H affordability safe harbors (W-2, Federal Poverty Line, and Rate of Pay methods).
  • 2I: Non-assessment period for multiemployer plan interim rule relief.

For a full reference list and guidance, check out the ACA 1095-C Codes Cheat Sheet and the detailed breakdown on the ACAwise Services Guide.

What is the ACA affordability threshold for 2026?

The Affordable Care Act (ACA) affordability threshold for plan years beginning in 2026 is 9.96% of an employee's household income (or applicable safe harbor wages). This is an increase from the 2025 rate of 9.02%.

Overview of 2026 Affordability

  • Percentage Limit: The employee's required monthly contribution for the lowest-cost, self-only coverage option providing minimum value cannot exceed 9.96% of their income.
  • Comparison: This marks an increase from 2025 (9.02%) and gives employers more flexibility regarding employee premium contributions.

Employer Safe Harbors for 2026

To avoid calculating individual household incomes, employers can use one of three IRS IRS Announces 2026 ACA Affordability Indexed Amount safe harbors:

  • Form W-2 Safe Harbor: Monthly self-only contribution is ≤ 9.96% of Box 1 W-2 wages.
  • Rate of Pay Safe Harbor: Monthly self-only contribution is ≤ 9.96% of computed monthly wages (hourly rate × 130 hours, or monthly salary).
  • Federal Poverty Line (FPL) Safe Harbor: Monthly self-only contribution is ≤ 9.96% of the applicable Federal Poverty Line amount. For the mainland U.S., this generally caps the lowest-cost monthly employee contribution around $129.89 (depending on exact FPL updates).