Form 1094-C is the transmittal form that is sent to the IRS along with a firm’s Form 1095-Cs. As noted in an earlier blog, this form is far more complicated and confusing than a mere “transmittal form” would suggest.
As a reminder, the option on line 22 are:
- Qualifying Offer Method
- Qualifying Offer Method Transition Relief
- Section 4980H Transition Relief
- 98% Offer Method.
You can’t complete line 22 of Form 1094-C unless you decode the options listed as “certifications of eligibility.” We have previously decoded what a “qualifying offer method” entails. Here’s the scoop on Option D, the 98% Offer Method.
Option D, the 98% Offer Method, is also hard to qualify for. It requires that:
- Employer that is an ALE (applicable large employer) offered for all months of the calendar year, affordable coverage that provided minimum value to at least 98% of employees receiving Form 1095-C
- MEC to dependents.
What’s the payoff for offering this generous coverage? An employer that meets these requirements doesn’t have to complete Part III, column (b) of Form 1094-C (the full-time employee count).
What’s the catch? Perhaps the better question is “that’s a payoff”? This may be a consideration if an employer has difficulty determining which employees are full-time.
Here’s what the IRS offers in an FAQ on employer reporting: http://www.irs.gov/Affordable-Care-Act/Employers/Questions-and-Answers-on-Reporting-of-Offers-of-Health-Insurance-Coverage-by-Employers-Section-6056#Methods%20of%20Reporting