Every tax season, the same question comes up for employees and employers alike: do I actually need this form, and if so, which one? If you’ve spent any time trying to sort out the difference between Form 1095-B and Form 1095-C (or if you’re wondering whether you need either of them at all) you’re not alone. These two forms serve related but distinctly different purposes, and the rules about who files what, who needs what, and when things are due trip up a lot of HR teams and business owners every year.

This guide covers both sides of the equation: what employees actually need at tax time, what employers are required to do, and where the compliance details can catch you off guard.

Key Takeaways

• For most employees, Forms 1095-B and 1095-C are not required to file a federal tax return. They are informational records, and the one form that can actually affect your taxes is Form 1095-A if you had ACA Marketplace coverage.
• Form 1095-C is required for Applicable Large Employers (ALEs), generally those with 50 or more full-time equivalent employees, and reports both the offer of coverage and the details of what was offered each month.
• Form 1095-B is filed by insurers and small employers offering self-funded coverage to confirm that individuals had minimum essential coverage; most small businesses with fully insured group plans do not file this form themselves.
• Employers offering an ICHRA still have ACA reporting obligations, and employees enrolled in both an ICHRA and ACA Marketplace coverage may receive multiple forms although typically only Form 1095-A affects their federal tax filing.

What Employees Need to Know

The most important thing to understand as an employee is this: for federal tax filing purposes, you almost certainly do not need your Form 1095-B or 1095-C. These forms are informational, documenting your health coverage for the year, but they are not required attachments to your federal return. Even major tax preparation platforms like TurboTax confirm that these forms typically aren’t needed for federal filing. Hold onto them for your records, but don’t let waiting for one delay your taxes.

When Form 1095 might matter for employees

There are two situations where a 1095 form becomes more relevant for employees. The first is state tax filing. Several states have their own individual health coverage mandates, and if you live in California, New Jersey, Rhode Island, or Washington D.C., your Form 1095-B or 1095-C may be needed when filing your state return. Massachusetts also has an individual mandate, but it uses its own separate form (MA 1099-HC) rather than the federal 1095 series.

The second situation involves Form 1095-A, which is different from 1095-B and 1095-C and should not be confused with them. If you enrolled in a health plan through an ACA Marketplace, you’ll receive a Form 1095-A from the Marketplace. This one can directly affect your federal taxes, particularly if you received premium tax credits. For more detail on how 1095-A works, the healthcare.gov guidance is a helpful resource.

If you participated in an Individual Coverage Health Reimbursement Arrangement (ICHRA) through your employer, you may receive both a Form 1095-B or 1095-C from your employer and a Form 1095-A from the ACA Marketplace. In that case, only the Form 1095-A is generally needed for federal tax filing purposes.

Why you might not receive a 1095 form automatically

You may notice that your employer has stopped automatically mailing your 1095-B or 1095-C. This is intentional and fully permitted. Under the Paperwork Burden Reduction Act, employers can now provide the forms only when employees request them, rather than send them to everyone by default. If you need a copy for your records or for state tax purposes, you can request one from your employer. They are required to provide it within 30 days of your request.

What Employers Need to Know

What Form 1095-B Is and Who Files It

Form 1095-B is a health coverage information return. It documents that an individual had minimum essential coverage (MEC) during the tax year, essentially functioning as proof of insurance at the individual level. Health insurance carriers file 1095-B forms for individuals covered under fully insured plans, and small employers with fewer than 50 full-time equivalent employees who offer self-funded (self-insured) coverage are also required to file 1095-B forms for their covered employees.

If you’re a small employer with a fully insured group health plan, your insurance carrier handles the 1095-B reporting entirely. Your employees may still receive a copy for their records, but you are not responsible for filing the form with the IRS.

Form 1095-B captures the name and Social Security number (or taxpayer identification number) of the primary insured individual, along with the same information for each covered dependent. It also identifies the type of coverage provided and the months during the year when coverage was in effect.

What Form 1095-C Is and Who Files It

Form 1095-C is the ACA reporting form specifically for Applicable Large Employers. It’s more complex than 1095-B, reflecting the broader obligations that come with ALE status. Where 1095-B simply confirms coverage existed, 1095-C tells the IRS what was offered, to whom, at what cost, and whether that offer met ACA affordability and minimum value standards.

Any employer with 50 or more full-time equivalent employees in the prior calendar year qualifies as an ALE and is required to file Form 1095-C for each full-time employee, regardless of whether the employee actually enrolled in coverage. The “50 FTE” threshold is calculated by combining actual full-time employees (those averaging 30 or more hours per week) with part-time hours converted into full-time equivalents. A business with 35 actual full-time employees and 60 part-time employees working an average of 15 hours per week would count those part-time hours as 30 FTEs, pushing the total to 65 and triggering ALE status. The IRS provides detailed guidance on this calculation.

Part II of Form 1095-C is where the complexity lives. Employers use a series of indicator codes to communicate detailed month-by-month coverage information for each full-time employee. Getting these codes right matters. An incorrect indicator code can cause the IRS to flag a potential employer shared responsibility payment even when the employer was actually compliant.

When You Need Both Forms

ALEs who offer self-funded (self-insured) coverage must file both Form 1095-C and provide the coverage information that would otherwise appear on a 1095-B. The IRS handles this by having these employers complete Parts I, II, and III of Form 1095-C, with Part III capturing the enrollment details for covered individuals — satisfying both reporting obligations in a single form. ALEs with fully insured coverage only need to complete Parts I and II; their insurance carrier handles the 1095-B reporting separately.

The PBRA Alternative Furnishing Method

One of the more meaningful recent changes for employers is the flexibility introduced by the Paperwork Burden Reduction Act. Employers can now use an alternative method for furnishing Forms 1095-B and 1095-C: meaning they no longer have to automatically mail a form to every employee. Instead, they can provide forms only upon request, as long as IRS requirements are met.

To use this approach:

• Employers must post a clear, accessible notice on their website by March 2 that explains how employees can request their forms
• Options must be available by mail, email, and phone
• Requested forms must be provided within 30 days
• The notice must remain posted through at least October 15

For employers whose workforce is based primarily in states without individual healthcare mandates, this change can significantly reduce the cost and effort of year-end processing. Most employees in those states will never need or request the form. That said, careful communication is essential — employees in mandate states (California, New Jersey, Rhode Island, Washington D.C., and Massachusetts) may need the form for state filing, and an unclear or hard-to-find notice creates confusion and compliance risk.

Deadlines and Penalties

The annual filing deadlines for ACA reporting follow a consistent pattern. The deadline for posting a notice for employees (for both 1095-B and 1095-C) is March 2 for the current filing year, though this date can shift slightly from year to year. Paper filings with the IRS are due February 28, and electronic filings are due March 31. Employers filing 10 or more information returns in a calendar year are required to file electronically, following updated IRS rules that took effect for tax year 2023 reporting.

The penalty structure for ACA reporting failures is tiered based on how quickly the error is corrected. For 2024 reporting, penalties range from $60 per return for corrections made within 30 days of the filing deadline, up to $310 per return for failures not corrected by August 1, to $630 per return for intentional disregard. With large workforces, these amounts add up quickly.

How ICHRA Affects Reporting Obligations

If your company offers an ICHRA rather than a traditional group health plan, your ACA reporting obligations still apply, but the specific requirements depend on your employer size.

Small employers (fewer than 50 FTEs) who use an ICHRA are not subject to the employer mandate and generally do not need to file Form 1095-C. However, because an ICHRA is a form of self-funded coverage, small employers with an ICHRA have an obligation to provide Form 1095-B to covered employees. In practice, this obligation can often be satisfied through the alternative furnishing method described above; posting a notice and providing the form upon request rather than mailing it automatically to every employee.

ALEs offering an ICHRA must still file Form 1095-C for all full-time employees. The indicator codes used in Part II reflect the ICHRA offer rather than a traditional group plan offer, and the affordability calculation follows a different formula, which is based on the premium for the lowest-cost silver plan available to the employee in their rating area. This requires employee-specific data like home ZIP codes and benchmark plan premiums, which can be difficult to reconstruct at tax time if it wasn’t captured during enrollment.

What You Don’t Need to File

Understanding what you’re not required to file is just as useful as understanding what you are. Small employers (under 50 FTEs) with a fully insured group health plan do not file either 1095-B or 1095-C. Their insurance carrier handles the 1095-B, and the employer mandate doesn’t apply to them at all.

If your business dropped below the 50 FTE threshold in the prior calendar year, you are not required to file Form 1095-C for the current reporting year, even if you were an ALE previously. Additionally, part-time and variable-hour employees who are never determined to be full-time under your ACA measurement method are not included on Form 1095-C (though they may appear in Part III if they were enrolled in self-funded coverage through the employer).

How Decisely Helps

ACA reporting doesn’t have to be an annual scramble. Decisely offers a full suite of Compliance Services, including ACA reporting and compliance monitoring. With year-round oversight from our in-house compliance experts, we help you manage all ACA federal and state requirements — including annual Forms 1094/1095-B and 1094/1095-C reporting and filing — so nothing falls through the cracks.

Whether you’re managing a traditional group plan, an ICHRA, or a combination of both, Decisely gives you the tools and expert support to stay compliant and keep your focus on running your business. Get in touch today to learn more about how we can help you reduce risk, cut unnecessary work, and make ACA reporting far less painful — for both employers and employees.

This article is for general informational purposes only and is not intended to provide legal or tax advice. ACA and tax rules can vary by situation, so employers and individuals should consult with their legal, tax, or compliance advisors regarding their specific obligations.

Frequently Asked Questions

Do employees need Form 1095-B or 1095-C to file their federal taxes? Generally, no. For most employees, these forms are informational records and are not required to file a federal tax return. The exception is Form 1095-A, which is issued to individuals who enrolled in coverage through an ACA Marketplace and may be needed for federal filing — especially if premium tax credits were received.

Why didn’t I receive a Form 1095-B or 1095-C this year? Many employers have adopted the alternative furnishing method permitted under the Paperwork Burden Reduction Act, which allows them to provide these forms only upon request rather than mailing them automatically. If you need a copy for any reason, you can request one from your employer, and they must provide it within 30 days.

What is the difference between Form 1095-B and Form 1095-C? Form 1095-B reports that an individual had minimum essential health coverage during the year. It’s filed by insurance carriers and small self-funded employers. Form 1095-C is filed by Applicable Large Employers (those with 50 or more full-time equivalent employees) and reports the details of what health coverage was offered to each full-time employee, month by month. Form 1095-C is tied to the employer mandate; Form 1095-B is tied to the individual coverage requirement.

Do small businesses have to file Form 1095-C? No. Form 1095-C is only required for Applicable Large Employers (generally those with 50 or more full-time equivalent employees in the prior calendar year). Businesses below that threshold are not subject to the employer mandate and do not need to file 1095-C forms.

What are the deadlines for ACA reporting? The deadline for furnishing employee copies of Forms 1095-B and 1095-C is March 2 for the current filing year (this date can shift slightly year to year). Paper IRS filings are due February 28, and electronic filings are due March 31. Employers filing 10 or more information returns are required to file electronically.

Do I have ACA reporting obligations if I offer an ICHRA? Yes, though the specifics depend on your employer size. ALEs offering an ICHRA must still file Form 1095-C for all full-time employees, using indicator codes specific to ICHRA offers. Small employers offering an ICHRA have a 1095-B furnishing obligation, which can often be satisfied through the alternative furnishing method by posting a notice and providing forms on request.

What happens if I file my ACA forms late or incorrectly? The IRS imposes tiered penalties for late, incorrect, or missing ACA returns. For 2024, penalties range from $60 per return (corrected within 30 days of the deadline) up to $630 per return for intentional disregard. For large employers, these penalties accumulate quickly across a full workforce.

What is Form 1094-C and how does it relate to Form 1095-C? Form 1094-C is the transmittal form that ALEs file with the IRS alongside all of their employee-level 1095-C forms. It serves as the cover sheet that summarizes the full-time employee count, ALE member information, and certifications of eligibility for transition relief. You cannot file 1095-C forms without the accompanying 1094-C.

Are dependents listed on Form 1095-C? For ALEs with fully insured plans, dependent information is not included on Form 1095-C — only the employee is listed in Part I. Dependent coverage information appears on the 1095-B provided by the insurance carrier. However, ALEs with self-insured plans must include covered dependents in Part III of the 1095-C form.