What ACA Employer Reporting Is
After each calendar year, Applicable Large Employers (ALEs) report to the IRS on the health coverage they offered (or didn’t offer) to each employee who was full-time for at least one full calendar month of the year. The IRS uses this information to:
- Determine whether an employer mandate penalty may apply
- Check whether employees were eligible for a Premium Tax Credit (PTC). An employee offered affordable, minimum value coverage generally isn’t eligible.
ALE reporting focuses on offers of coverage, including the employee’s contribution for the lowest-cost, self-only plan offered that provides minimum value. That’s true even if the employee chose a different plan or didn’t enroll at all.
Reporting on coverage is separate. Insurance carriers (for fully insured plans) and employers of any size with self-funded or level-funded plans report who was actually covered. In short, ALEs report offers, and carriers and self-funded employers report coverage. A self-funded ALE reports both on Form 1095-C. Some states, including California, have their own separate reporting requirements as well.
The Forms
There are two core IRS forms used by ALEs for ACA reporting:
- Form 1094-C (employer-level transmittal): Summarizes employer information, such as full-time and total employee counts and whether the employer is part of an Aggregated ALE Group. Each ALE member files its own.
- Form 1095-C (employee-level statement): One for each employee who was full-time for at least one full calendar month of the reporting year. It shows, month by month, the coverage offered, the employee’s cost share (employee’s contribution) of the lowest-cost self-only premium, and codes explaining the offer, such as which affordability safe harbor applies. Self-funded ALEs also use it to report who was covered.
Other entities also file related forms:
- 1095-A: Filed by the Marketplaces, such as Covered California and Nevada Health Link
- 1095-B: Filed by insurance carriers, and by self-funded employers that aren’t ALEs
Reporting Deadlines
For returns due in 2026:
| Who Reports | Forms | Employee Copies (Form 1095 Only) | IRS Electronic Filing |
|---|---|---|---|
| Insurance carriers and non-ALE self-funded employers | 1094-B / 1095-B | March 2 | March 31 |
| Applicable Large Employers (ALEs) | 1094-C / 1095-C | March 2 | March 31 |
Key timing notes:
- If a deadline falls on a weekend or holiday, it moves to the next business day.
- Electronic filing is required for employers filing 10 or more information returns of all types combined (W-2s, 1099s, 1095s and others). Electronic ACA filings go through the IRS’s ACA Information Returns (AIR) system, which requires advance setup. Many employers use payroll vendors or reporting providers.
- Paper filing, only for those under the 10-return threshold, is due by the end of February.
- Copies on request: Under a 2024 law, an employer can satisfy the employee-copy requirement by posting a clear notice, by the deadline, that employees may request a copy, and then providing copies on request. State rules, such as California’s, may still require sending copies.
Penalties for Reporting Failures
The IRS can assess separate penalties for failing to file with the IRS and failing to furnish employee copies, including for late, incomplete or incorrect forms. Penalties apply per form and are lower when errors are corrected quickly. They may be waived for reasonable cause.
| Penalty Type | Corrected within 30 days | Corrected by August 1 | After August 1 or not filed | Intentional Disregard |
|---|---|---|---|---|
| Per Return | $60 | $130 | $340 | $680 |
| Annual maximum (gross receipts of $5M or less) | $239,000 | $683,000 | $1,366,000 | No limit |
| Annual maximum (gross receipts over $5M) | $683,000 | $2,049,000 | $4,098,500 | No limit |
These amounts are adjusted each year. See the IRS’s Information Return Penalties page for current figures.
Important: This information is provided for general educational purposes and reflects the rules as of October 2026. It is not legal or tax advice. How these rules apply depends on each employer’s specific circumstances, so employers should review their situation with their own legal counsel, ERISA attorney, CPA or tax advisor.