what is a 1095-c form

3 min read 16-01-2025

The Affordable Care Act (ACA) mandates that certain employers provide health insurance coverage to their employees. If your employer offers a health plan, you may receive a 1095-C form. This form reports the health coverage offered to you and your dependents during the tax year. Understanding this form is crucial for accurate tax filing. Let's delve into the details.

What is Form 1095-C?

The 1095-C form, Employer-Provided Health Insurance Offer and Coverage, is an informational tax form. It’s not a tax return itself; you don't pay taxes using it. Instead, it provides the IRS and you with information about the health insurance your employer offered you during the tax year. This information helps determine your eligibility for the Premium Tax Credit (PTC) if you purchased health insurance through the Health Insurance Marketplace.

The IRS uses this data to verify that you accurately reported your health coverage when filing your taxes. Your employer is required to send you this form by January 31st of the following year. For example, the 2023 1095-C form was due January 31, 2024.

Who Receives a 1095-C Form?

You'll receive a 1095-C form if:

You are an employee of a Applicable Large Employer (ALE): An ALE is an employer with 50 or more full-time equivalent employees.
Your employer offers self-insured health coverage: This means the employer directly pays for the healthcare costs of its employees, instead of using an insurance company.
You were offered health insurance: Even if you declined coverage, you'll likely still receive a 1095-C form indicating the offer was made.

Key Information on the 1095-C Form

The 1095-C form contains several key pieces of information:

Employer Identification Number (EIN): Your employer's tax identification number.
Employee Information: Your name, address, and Social Security Number (SSN).
Months of Coverage: Indicates the months you were offered health insurance.
Offer of Coverage: Shows whether you were offered minimum essential coverage.
Type of Coverage: Specifies the type of health insurance plan offered (e.g., self-insured, insurance company).
Dependent Information: Details about your dependents covered under the plan.

It's essential to carefully review all the information provided to ensure its accuracy. Any discrepancies should be reported to your employer immediately.

How to Use Your 1095-C Form

You'll need your 1095-C form when filing your federal income tax return. The information on the form helps you:

Determine your eligibility for the Premium Tax Credit (PTC): If you purchased insurance through the Marketplace, the 1095-C form helps determine if you're eligible for a tax credit to offset the cost of your premiums.
Avoid penalties: Accurate reporting of your health insurance coverage prevents potential penalties for not having minimum essential coverage.

You generally don’t attach the 1095-C form to your tax return. The IRS receives a copy directly from your employer. However, keeping a copy for your records is crucial in case of an audit.

What if I Don't Receive a 1095-C Form?

If you believe you should have received a 1095-C form but haven't, contact your employer immediately. They are responsible for issuing the form. Delays can complicate your tax filing, so prompt action is vital.

Understanding Your 1095-C Form: A Crucial Step in Tax Season

The 1095-C form plays a vital role in complying with the ACA's requirements. Understanding its contents is essential for accurate tax filing and avoiding potential penalties. Keep your form in a safe place, and don't hesitate to contact your employer or a tax professional if you have questions.

Disclaimer: This article is for informational purposes only and does not constitute tax advice. Consult with a qualified tax professional for personalized guidance.