1095-C Form 

As part of the final preparation for submitting and mailing employee 1095-C forms, please carefully review the information on each form to ensure the information is accurate.

In the  "Prepare Tax Returns" process, you will have the opportunity to download the employee 1095-C forms for each division, either in a PDF or Excel format.  For purposes of this guide, and since employees receive the PDF, we will use that for our examples below.  

Company Information 

The left side of each 1095-C form contains identifying and contact information for your company and the employee. The company information includes the company name, address, phone number, and Employer Identification Number (EIN).  You have the option of using ACA Track's Call Center number or your own company telephone number.  If you choose to use ACA Track's Call Center we will respond to general inquiries regarding the form.  Specific data questions will be routed back to the employer. 

You should review this information to ensure it is accurate. If your company has more than one division (with different EINs), make sure the correct division is listed for the employee.  If an employee changes divisions during the year, they will receive a 1095-C form from each division. 

The Plan Start box will be filled with a two-digit number (01 through 12) indicating the calendar month in which the health plan year began. If more than one plan year could apply (for instance, if you change the plan year during the year), the earliest applicable month will be populated in this area.  If there is no health plan under which coverage is offered to the employee, “00” will be shown in the box.  If the employee was enrolled in a union plan or was not eligible for the entire year, the box will be blank. 

 

Employee Information 

When checking the employee information, it is important to make sure their address is correct, since this is where the 1095-C forms will be mailed. You should also check for any misspellings or incorrect SSNs. To minimize the amount of protected information printed on the form, only the last four digits of the SSN are shown on the form. 

Note, the employees’ age (as of January 1 of the reporting year) is required ONLY IF the employee participated in an Individual Coverage Healthcare Reimbursement Arrangement (ICHRA), otherwise it will be blank.  

Line 14 – Offer of Coverage 

Line 14 on the 1095-C document is used to report the lowest cost, single-tier plan offered to the employee for each month of the year, including: 

3. Whether the individual was offered health insurance coverage. 
4. The type of coverage that was offered to the employee. 
5. The months in which that coverage was offered.  

Line 14 does NOT indicate whether an offer of coverage was accepted. Coverage details are provided in Line 16. 

In the above example, the employee had the same coverage available for the entire year, so the response is listed only once, in the top row under “All 12 months”. If the available coverage changed during the year, a separate response would be entered for each month. 

Line 14 Codes 

A Line 14 response is reported for each month of the year, and may contain one of the following codes: 

1A – Qualifying offer 

This code indicates that the employee was offered health insurance in the given month, which was considered a Qualifying Offer. A Qualifying Offer means the health insurance plan provided minimum essential coverage and minimum value coverage for the employee, and the lowest-cost self-only plan cost less than the current Federal Poverty Level (FPL) affordability safe-harbor rate.

A Qualifying Offer must also include an offer of minimum essential coverage to the employee’s spouse and dependents. 

1B – Employee Only Offered 

This code indicates that the employee was made an offer for minimum essential coverage and minimum value coverage, at an affordable rate. Health insurance coverage was not offered for their spouse or dependents. 

1C – No Spouse Coverage Offered 

This code indicates that the employee was made an offer for minimum essential coverage and minimum value coverage, at an affordable rate.  

Minimum Essential Coverage was also offered for dependents, but not for a spouse. 

1D – No Dependent Coverage Offered 

This code indicates that the employee was made an offer for minimum essential coverage and minimum value coverage, at an affordable rate.  

Minimum Essential Coverage was also offered for a spouse, but not for dependents. 

1E – Spouse or Dependent Coverage Offered 

This code indicates that the employee was made an offer of minimum essential coverage and minimum value coverage, at an affordable rate.  

Minimum Essential Coverage was also offered for their spouse and dependents. 

1F – Plan Does Not Cover 60% of Estimated Claims 

This code indicates that the employee was offered Minimum Essential Coverage, but that the offer did not provide Minimum Value to the employee, spouse, and/or dependents. 

1G – Insured Non-Full-time Employee 

This code indicates that insurance coverage through a self-funded plan was offered to and accepted by an individual that is not a full-time employee. This code is commonly used for retirees. 

1H – No Offer of Coverage 

This code indicates that no health insurance coverage was offered to the employee, or the offer did not include Minimum Essential Coverage. 

1J – Conditional Spouse Coverage - Spouse Coverage Offered, No Dependents Coverage Offered For plans with conditional spousal coverage. This code is used when Minimum Essential Coverage was offered for a spouse, but not dependents. This code is used in place of 1D. 

1K – Conditional Spouse Coverage - Dependents Coverage Offered, No Spouse Coverage Offered  For plans with conditional spousal coverage. This code is used when Minimum Essential 

Coverage was offered for dependents, but not a spouse. This code is used in place of 1C. 

Line 15 – Employee Required Contribution  

Line 15 reports the employee’s required contribution for each month. The Employee Required Contribution is the price of the lowest-cost, self-only coverage available under the plan. 

This section only needs information if line 14 has a response code of 1B, 1C, 1D, 1E, 1J, or 1K. If line 14 has one of those responses for “All 12 Months,” there should be a line 15 entry for all 12 months as well. If line 14 has any months without one of these responses, line 15 should be blank for the corresponding months. 

Note: The Employee Required Contribution does not indicate the amount the employee actually paid, since the employee could have chosen a higher-priced plan and/or purchased insurance for their spouse and dependents.   

Line 16 - Eligibility 

Line 16 on the 1095-C form is used to report on an individual’s eligibility for health insurance coverage and their coverage status for the given month. 

Line 16 addresses the following: 

1. Whether the individual was employed, and whether that employment was full-time or not. 
2. Whether the employee was enrolled in health insurance coverage. 
3. Whether the employer was eligible for any form of relief because of contributions to a union health plan or because the employee was in a limited non-assessment period.  The most common limited non-assessment period is a new hire waiting period.  
4. Whether the offered coverage was affordable, and which IRS safe harbor method was used to determine affordability. 
   

In the above example, the employee had the same eligibility for the entire year, so the response is listed only once, at the top of the column. If their eligibility changed during the year, a separate response would be entered for each month. 

Line 16 Codes  

A Line 16 response is reported for each month of the year, and may contain one of the following codes: 

2A – Not Employed 

 This code indicates that the individual was not employed during the reported month. If the employee was only employed for part of the month, a code of 2B would be shown. 

2B – Employed but Not Full Time For the Entire Month 

This code indicates that the individual was employed during the month but not on a full-time basis; therefore, they were not eligible for health insurance benefits for the entire month. This code is common when an employee is part-time or if the employee was hired mid-month. 

2C - Enrolled 

This code indicates the individual was employed during the reported month and covered under a health insurance plan. 

2D – Waiting Period 

This code indicates the employee was in a measurement or waiting period before becoming eligible for health insurance coverage. This is sometimes referred to as a limited non-assessment period. 

2E – Union Sponsored / Multi-Employer Plan 

This code indicates the employee was covered under a multi-employer plan, such as a Union Sponsored Plan, for which the employer paid a fee based on a collective bargaining agreement. 

2F – Waived Coverage 

This code indicates the employee waived coverage for the reported month, and the employer used Form W-2 Safe Harbor to determine affordability. 

2G – Waived Coverage 

This code indicates the employee waived coverage for the reported month, and the employer used Federal Poverty Line Safe Harbor to determine affordability. 

2H – Waived Coverage 

This code indicates the employee waived coverage for the reported month, and the employer used the “Rate of Pay” Safe Harbor to determine the affordability of the plan. 

**For a designated code to appear for a specified month, the employee must have met the criteria for the code for all days of the month. For example, to receive a 2C for October, the employee would have to be enrolled for all 31 days of the month. 

      

Covered Individuals 

For self-insured or level-funded plans, the covered employee, along with any insured dependents or spouses will be listed in the “Covered Individuals” section of the 1095-C.  

If the individuals were covered all year, there will be an X in the “Covered all 12 mos.” box. Otherwise, each month they were covered will be marked separately.  

You should carefully review this section to ensure dependents are correctly associated with the appropriate employee and their months of coverage are reflected accurately.  

Note: This section only pertains to self-insured health plans. Dependents and spouses will not be listed on a fully-insured plan, as they will receive separate documentation directly from the health insurance provider.        

Sample 1095-C Forms with Various Scenarios  

The documents below are meant to be examples of what you should expect to see for some of the most common employee situations. Each employee situation is different, so you may have employees whose 1095-C forms do not match any of the examples below. To verify that those forms are correct, use the Line 14 and Line 16 guides above. 

Full-time, insured all year 

If an employee’s status and coverage has remained constant throughout the year, columns 14, 15, and 16 will remain unchanged. In this case, you will only find one entry for each in the “All 12 Months” line, rather than an entry for each individual month. 

In the above example, the employee was offered insurance for themselves, dependents, and their spouse (1E); the offer was accepted (2C); and their monthly required contribution for the lowest cost plan remained unchanged throughout the year. 

It’s also possible that some of the categories will remain the same all year, while others will change. This will  happen if your plan’s renewal date is mid-year, in which case, lines 14 may remain the same, while the Employee Required Contribution and election code may change due to cost changes for coverage and/or the employee election changing from insured  to waived, or vice-versa: 

Mid-year Hire (with a waiting period) 

Employees hired mid-year are often required to go through a waiting period before they become eligible for health benefits. In this case, their 1095-C forms will show: 

1. For the period of time they were not employed, the value in line 14 will be 1H (no offer of coverage), line 15 will be blank, and line 16 will be 2A (not employed).  
2. Once they are hired, line 16 will be changed to indicate they are in a waiting period, if applicable (2D). 
3. When they become eligible for insurance, line 14 will change to indicate that an offer was given, line 15 will reflect the price of the lowest-cost single only coverage option, and line 16 will indicate whether they accepted the insurance. 
   

In the example above, the employee was not employed until the month of June. During the month of June they were in a waiting period. Beginning in July, they were enrolled in the plan at a rate of $120.00 for the lowest-cost single coverage.  

Full-time to Variable Hour 

When an employee moves from full-time to variable hour or part-time, they may become ineligible for health insurance coverage. In this case, they will have the option to continue receiving insurance through COBRA coverage. Since COBRA coverage does not need to be reported on a fully insured plan, the form will only show COBRA elections if the plans are self or level funded. 

COBRA Elected due to Reduction In Hours 

If the employee elects COBRA coverage due to a reduction in hours, lines 14 and 16 should remain unchanged, but the Employee Required Contribution will change to reflect the new COBRA costs. 

In the example above, the employee transitioned to COBRA coverage in July, as evident by a contribution increase. Note that in this example, the employee is still actively employed, but was offered COBRA due to a reduction in hours.  

COBRA Waived due to Reduction In Hours 

If the employee waives COBRA coverage, line 16 will be updated to show they were no longer eligible for employer-based insurance coverage, because they were not employed full-time. Line 15 is updated to show the new pricing under COBRA. Note that line 14 does not change because an offer (of COBRA) was still made to the employee during their Variable Hour (or part time status) period, which they waived. 

As with the COBRA Elected Due to Reduction in Hours example, it is important to note that this employee is still actively employed, was offered COBRA due to a reduction in hours, and waived the election of COBRA.      

Variable Hour to Full-time 

Employees that transition from part-time/variable hour (ineligible for coverage) to full-time, will reflect the following: 

1. During their variable hour employment, line 14 will show 1H (no offer given) and line 16 will be 2B (employed, but not full-time). Because health coverage was not available to them, line 15 will be blank.  
   
2. If there is a waiting period before they become eligible for insurance, lines 14 and 15 will remain unchanged during this time, but line 16 will show 2D, indicating that they are in a waiting period. 
   
3. Once they become eligible for coverage, lines 14 and 16 will represent their full-time status and whether they accepted or waived coverage, and line 15 will show the appropriate required contribution. 
   

In the above example, this employee worked part-time from January to  April,  did not have a waiting period and then was full-time and waived coverage from May through December. Had the employee elected coverage, it would have cost $120.00 for the lowest cost available for single-only coverage.  

      

Termed Employee 

If an employee terminated during the reporting year, their form will differ depending on whether they were covered by a self-insured plan or a fully-insured plan. 

Fully-Insured Plans 

Under a fully-insured plan, you are not required to report COBRA coverage elected after a termination. In this case, the employee’s 1095-C form will show their insurance status up to their termination month, and then change to a 1H/2A (No Offer of Coverage/Not-Employed) status for the remainder of the year. 

 

In this example, the full-time employee was insured from January through April, at which time they terminated employment.  

Self-Insured Plan 

If the employee was on a self-insured health plan, you are required to report COBRA coverage elections upon termination. 

If the employee elected COBRA coverage after employment ended, it will not be reflected in the “Offer of Coverage” section. The “Covered Individuals” section will indicate which months the employee and their dependents were covered, both under the employer’s health plan and COBRA: 

In this example, the employee terminated in April. They elected cobra coverage for the months of May through October.