IRS Form 1095-C Changes For The 2021 Tax Year

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The IRS Issued a Final Version of 2021 ACA Forms 1095-C

Updated on November 09, 2021 - 10:30 AM by Admin, TaxBandits

Every year, the IRS updates the Form 1095-C by adding new lines and codes to improve efficiency of
health coverage reporting.

With the arrival of tax season in 2021, the IRS released the final version of Form 1095-C with changes at the
end of October.

However, before we dive into the changes, please be reminded, the IRS Form 1095-C is typically used by the ALEs to report information about health coverage and enrollment offered to employees, as required under
Section 6055 and 6056.

In this article, we cover the following topics:

1. What are the 1095-C updates for 2021?

There are a few changes to Form 1095-C for the 2021 tax year that employers should be aware of.

a. 30-Day Extension of Form 1095-C Reporting Deadline

Similar to last year, the IRS announced it was extending the deadline for distributing Form 1095-C to individuals from January 31st to March 02nd.

For paper filers, the deadline is February 28, 2022. Electronic filers have until March 31, 2022.

b. New Codes Added on 2021 Form 1095-C

As of October, the IRS released a new version of Form 1095-C, which adds two new codes on Line 14 and is effective for the 2021 tax year.

Any ALEs that offer individual HRA coverage (ICHRA Coverage) can use two previously reserved codes
(1T - 1U) from Code Series 1 on Form 1095-C, line 14, for reporting offers of coverage for 2021 tax year.

Click here to learn more about the Form 1095-C Line 14 and 16 Codes.

c. IRS Proposes New E-filing Requirements for Form 1095-C

This new e-filing requirement instructs employers to switch from paper filing to solely e-filing.

The current e-file threshold is 250 or more. However, this threshold could be reduced by the IRS in
the upcoming year.

It is expected that the IRS will lower the threshold to 100 returns for the 2022 tax year. Beyond 2022, the IRS would then slash this number from 100 to 10.

2. E-File your Form 1095-C with TaxBandits

Get Started with TaxBandits, an IRS authorized solution provider to e-file your Form 1095-C. Our built-in error checks help you to identify the basic errors in the Form. It saves your time as well as the accuracy of
your Form 1095.

TaxBandits keeps up with the 1095-C changes so you don’t have to! Plus, we offer filing with both the federal and the state, online access and postal mailing solutions for your recipient copies.

Steps to E-file 1095-C with TaxBandits:

  • Create your TaxBandits Account
  • Click “Start New Form
  • Choose "Form 1095-C" and enter the details.
  • Review, Pay and Transmit to the IRS

You will get the return status instantly when you file with our software. You can also opt for employee copy distribution, if necessary.

Are you ready to file Form 1095-C? Get Started with TaxBandits & file your form in minutes.

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