Early last week rumors surfaced that the IRS would issue ACA extensions for 2016 filing. On Friday, November 18 a notice of extension issued by the IRS confirmed the rumors. In the notice, Hilary March of the Office of Associate Chief Counsel confirmed that there will be limited extensions for the 2016 ACA filing year, much like those issued for the 2015 ACA filing year.
2016 IRS ACA Extensions
- 1095-C forms should be postmarked to employees by March 2, 2017
- Extension of the Good Faith Effort exemption through the 2016 reporting year
2016 IRS ACA Deadlines (Not Extended)
- The deadline for filing on paper (only for employers with fewer than 250 forms) is still February 28, 2017
- Employers should still E-file 1094-C and 1095-C forms to the IRS by March 31, 2017
What does this mean for employers?
Employers now have more time to perfect data and ensure the 1094-C and 1095-C forms are accurate before filing. These limited extensions offer employers a much-needed reprieve, but employers should use the additional time wisely. While the extensions are similar to those from the 2015 filing year, a lot has changed since then. For one, the margin of error has decreased from 30% in 2015 to 5% this year. Additionally, the penalties for non-compliance are higher. Now more than ever it is essential to ensure 100% filing accuracy, and these extensions provide additional time for employers to do just that.