Instructions For Forms 1094-C And 1095-C - 2017 (Page 15 of 17) in pdf

employee whose employment had been terminated during the

under section 4980H, and not for purposes of determining if the

break in service would not be treated as an employee for

employer is an Applicable Large Employer.) For purposes of

reporting purposes.

both methods, 130 hours of service in a calendar month is

treated as the monthly equivalent of at least 30 hours of service

Employee Required Contribution. The Employee Required

per week.

Contribution is the employee’s share of the monthly cost for the

An ALE Member must report complete information for all 12

lowest-cost self-only minimum essential coverage providing

months of the calendar year for any of its employees who were

minimum value that is offered to the employee by the ALE

full-time employees for one or more months of the calendar year.

Member. The employee share is the portion of the monthly cost

For more information on the identification of full-time employees,

that would be paid by the employee for self-only coverage,

including discussion of the monthly measurement method and

whether paid through salary reduction or otherwise.

the look-back measurement method, and the rules for when an

For purposes of determining the amount of the employee’s

ALE Member may use one or both methods, see Regulations

share of the monthly cost, an ALE Member may divide the total

sections 54.4980H-1(a)(21) and 54.4980H-3 and Notice

cost to the employee for the plan year by the number of months

2014-49, 2014-41 I.R.B. 66 (describing a proposed approach to

in the plan year. This monthly amount of the employee’s share of

the application of the look-back measurement method in

the cost would then be reported for any months of that plan year

situations in which the measurement period applicable to an

that fall within the 2017 calendar year. For example, if the plan

employee changes).

year begins January 1, the ALE Member may determine the

Note. A former employee (for example, a retiree) is not a

amount to report for each month by taking the total annual

full-time employee for any month after termination of

employee cost for all 12 months and dividing by 12. If the plan

employment with the ALE Member. However, if the former

year begins April 1, the ALE Member may determine the amount

employee was a full-time employee for any month of the

to report for January through March, 2017, by taking the total

calendar year (for example, before retiring mid-year), the ALE

annual employee cost for the plan year ending March 31, 2017,

Member must complete information in Part II of Form 1095-C for

and dividing by 12 (and reporting that amount for January,

all 12 months of the calendar year, using the appropriate codes.

February, and March 2017). Then the ALE Member may

determine the monthly amount for April through December, 2017

An ALE Member need not file a Form 1095-C for an

by taking the total annual employee cost for the plan year ending

individual who for each month of a calendar year is

TIP

March 31, 2018, and dividing by 12 (and reporting that amount

either not an employee of the ALE Member or is an

for April through December 2017).

employee in a Limited Non-Assessment Period with respect to

section 4980H(b). However, for the months in which the

The Employee Required Contribution may not be the amount

employee was an employee of the ALE Member, such an

the employee paid for coverage. For additional rules on

employee would be included in the total employee count

determining the amount of the Employee Required Contribution,

reported on Form 1094-C, Part III, column (c). Also, if during the

including for cases in which an ALE Member makes available

Limited Non-Assessment Period the employee enrolled in

certain HRA contributions, cafeteria plan contributions, wellness

coverage under a self-insured employer-sponsored plan, the

program incentives, and opt-out payments, see Regulations

ALE Member must file a Form 1095-C for the employee to report

sections1.5000A-3(e)(3)(ii) and 1.36B-2(c)(3)(v)(A). Also see

coverage information for the year.

Notice 2015-87.

Employer. For purposes of these instructions, an employer is

Full-time equivalent employees. A combination of

the person that is the employer of an employee under the

employees, each of whom individually is not treated as a

common-law standard for determining employer-employee

full-time employee because he or she is not employed on

relationships and that is subject to the employer shared

average at least 30 hours of service per week with an employer,

responsibility provisions of section 4980H (these employers are

but who, in combination, are counted as the equivalent of a

referred to as ALE Members). For more information on which

full-time employee solely for purposes of determining whether

employers are ALE Members, see the definitions of Applicable

the employer is an ALE. For rules on how to determine full-time

Large Employer (ALE) and Applicable Large Employer Member

equivalent employees, see Regulations section 54.4980H-2(c).

(ALE Member).

Governmental Unit and Agency or Instrumentality of a

Full-time employee. For purposes of Forms 1094-C and

Governmental Unit. A Governmental Unit is the government of

1095-C, the term “full-time employee” means a full-time

the United States, any State or political subdivision thereof, or

employee as defined under section 4980H and the related

any Indian tribal government (as defined in section 7701(a)(40))

regulations, rather than any other definition of that term that the

or subdivision of an Indian tribal government (as defined in

ALE Member may use for other purposes. Accordingly, a

section 7871(d)). For purposes of these instructions, references

full-time employee is an employee who, for a calendar month, is

to a Governmental Unit include an Agency or Instrumentality of a

determined to be a full-time employee under either the monthly

Governmental Unit. Until guidance is issued that defines the

measurement method or the look-back measurement method

term Agency or Instrumentality of a Governmental Unit for

(as applicable to that employee). The monthly measurement

purposes of section 6056, an entity may determine whether it is

method and the look-back measurement method are the two

an Agency or Instrumentality of a Governmental Unit based on a

methods provided under the section 4980H regulations for

reasonable and good faith interpretation of existing rules relating

determining whether an employee has sufficient hours of service

to agency or instrumentality determinations for other federal tax

to be a full-time employee. Under the monthly measurement

purposes.

method, a full-time employee is an employee who was employed

Health coverage. As used in these instructions, health

an average of at least 30 hours of service per week with the ALE

coverage refers to minimum essential coverage, unless

Member during a calendar month. Under the look-back

otherwise indicated.

measurement method, an employee is a full-time employee for

each month of the stability period selected by the ALE Member if

Hours of service. An hour of service is each hour for which an

the employee was employed an average of least 30 hours of

employee is paid, or entitled to payment, for the performance of

service per week with the ALE Member during the measurement

duties for the employer, and each hour for which an employee is

period preceding that stability period. (The look-back

paid, or entitled to payment, for a period of time during which no

measurement method for identifying full-time employees is

duties are performed due to vacation, holiday, illness, incapacity

available only for purposes of determining and computing liability

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Instructions for Forms 1094-C and 1095-C (2017)

Instructions For Forms 1094-C And 1095-C - 2017 Page 15

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