Form 1095-B

Form 1095-B, issued by the Internal Revenue Service (IRS), is a tax form used to report information about individuals’ health insurance coverage. This form is utilized primarily to demonstrate that an individual has had minimum essential coverage (MEC) throughout the year, as required by the Affordable Care Act (ACA). The goal is to help the IRS verify that taxpayers and their dependents have compliance with the health insurance mandate.

Purpose of Form 1095-B

Form 1095-B serves several key purposes:

1. It confirms that an individual has had MEC for each month of the year, thus avoiding the individual shared responsibility payment (penalty).
2. It provides the IRS with information on the type of health insurance coverage provided, including the insurer and the covered individuals.
3. It helps individuals confirm their health insurance status for their own records and tax filing purposes.

Who Receives Form 1095-B?

Generally, Form 1095-B is issued by health insurance providers, including:

• Health insurance companies that provide individual marketplace plans.
• Government-sponsored programs such as Medicare, Medicaid, and CHIP.
• Certain self-funded employers and small employers who are not required to provide Form 1095-C.
• Other entities providing MEC.

Individuals typically receive this form if they are enrolled in any of the above types of health plans.

Information Included on Form 1095-B

Form 1095-B is divided into sections containing critical information about the health coverage provided:

1. Part I - Responsible Individual: This section includes personal details about the primary insured individual, such as name, address, Social Security number, and birth date.
2. Part II - Information about Certain Employer-Sponsored Coverage: This section provides details about employer-sponsored coverage, including the employer’s name, EIN, and contact information.
3. Part III - Issuer Information: This section includes details about the insurance provider, including their name, EIN, and contact information.
4. Part IV - Covered Individuals: This section lists each individual covered under the plan, including their names, Social Security numbers (or other TINs), and the months for which they had coverage during the year.

Filing and Distribution Requirements

For Issuers

• Filing with the IRS: Health insurance issuers must file Form 1095-B with the IRS, typically by February 28th if filing on paper or by March 31st if filing electronically.
• Providing to Individuals: Issuers must furnish copies of Form 1095-B to insured individuals by January 31st of the following year.

For Individuals

• Retain for Records: Taxpayers should keep Form 1095-B with their tax records. It is not required to be attached to their tax return but can serve as proof of coverage.
• Reporting on Tax Return: Taxpayers should indicate on their individual tax return if they had health insurance coverage for each month of the year, supported by Form 1095-B.

Differences Between Form 1095-A, 1095-B, and 1095-C

• Form 1095-A: Issued by the Health Insurance Marketplace for individuals who purchased health insurance through the exchanges. It includes details necessary for the Premium Tax Credit (PTC) reconciliation.
• Form 1095-C: Issued by Applicable Large Employers (ALEs) to provide information about the health insurance offered to employees, including whether it was MEC and affordable.

Each of these forms serves a distinct purpose and pertains to different sources and types of insurance coverage.

Corrections and Amendments

Errors on Form 1095-B, whether discovered by the insurer or the individual, should be corrected promptly. This can involve issuing a corrected form to both the individual and the IRS. Individuals should contact their insurance provider if they find discrepancies or missing information.

Impact of COVID-19 on Form 1095-B

Due to the COVID-19 pandemic, there have been some delays and adjustments concerning the distribution and filing deadlines of Form 1095-B. The IRS has occasionally provided extensions for these requirements, and insurers may have communicated these changes to policyholders.

Resources for Form 1095-B

• Internal Revenue Service (IRS) - Form 1095-B
• Centers for Medicare & Medicaid Services (CMS)

Conclusion

Form 1095-B plays a critical role in the administration of the ACA’s health insurance mandate. It helps ensure individuals meet their health insurance requirements and aids in the accurate reporting of health coverage on annual tax returns. Understanding the purpose and requirements of Form 1095-B is essential for taxpayers, employers, and insurance providers in maintaining compliance with federal health insurance regulations.