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In December 2024, President Joe Biden signed two bills into law – the Employer Reporting Improvement Act (ERIA) and the Paperwork Burden Reduction Act (PBRA).

These laws simplify the reporting requirements for the Affordable Care Act (ACA). Below are the key changes:

 

Employers can make Forms 1095-B and 1095-C available upon request

Employers are no longer required to distribute Forms 1095-B and 1095-C. Instead, employers can opt to distribute the forms only when an employee requests one.

To fully comply with this new rule, an employer must provide “clear, conspicuous, and accessible notice” to employees that those entitled to receive a Form 1095-B or 1095-C may request one. If a request is made, an employer must provide the form within 30 days or by January 31st of the year following the reporting year, whichever comes later.

However, it's important to note that employers are still required to submit the forms to the IRS.

 

Employers can electronically distribute Forms 1095-B and 1095-C

Provided an employee gives consent, employers can distribute Forms 1095-B and 1095-C electronically. An individual consents to receive the form electronically if they have previously consented to an electronic form a prior time. In other words, once an employee consents to receive an electronic form, that consent carries forward.

At any point, an individual may withdraw their electronic consent in writing and request a paper copy instead.

 

ERIA extends deadline to respond to IRS Letter 226-J

The ERIA provides additional time for employers to respond to a penalty assessment letter – Letter 226-J. The deadline is now 90 days. Previously, it was set at 30 days.

 

A statute of limitations now applies to IRS penalty assessments

Up until this point, there was no statute of limitations for when the IRS can assess any employer shared responsibility penalties. The ERIA sets a six-year window for the IRS to assess these penalties.

This six-year window begins on the employer due date for filing the 1095 forms or the date the returns were actually filed, whichever comes later.

 

Disclaimer: This is simply a summary of some provisions contained in the aforementioned acts. This does not constitute legal advice. Always check with your own legal and/or financial advisors as to how this law and others may apply to you or your business.