Differences between 1095 forms: 1095-A vs. 1095-B vs. 1095-C

Understanding health insurance paperwork is essential for businesses to ensure compliance with a complex array of regulations, including the Affordable Care Act (ACA). The Internal Revenue Service’s (IRS) 1095 forms are critical health coverage documents. The IRS requires health plan providers and applicable employers to report health coverage information using Forms 1095-A, 1095-B, and 1095-C. These tax forms must be submitted to the IRS and to employees (if required) to maintain compliance with reporting regulations. The primary purpose of these forms is to assist both taxpayers and the IRS in verifying that individuals have the minimum essential coverage required under the ACA. For business owners, failure to manage health insurance paperwork properly can result in serious legal and financial consequences. 

In this article, we’ll explore the three 1095 tax forms, their specific purposes, who is responsible for using them, and how. 

What is a 1095-A form? 

IRS Form 1095-A, also known as the Health Insurance Marketplace statement, is a document sent to individuals who purchased health insurance through the Health Insurance Marketplace (sometimes called an exchange). It contains important tax information and is required by individuals to fill out IRS Form 8962, the Premium Tax Credit (PTC). Form 8962 is required to claim the Premium Tax Credit.

Who files the 1095-A form?

Form 1095-A is issued for information purposes only. Individuals who had a Marketplace plan in the previous year need to use information from their 1095-A to complete IRS Form 8962 to reconcile any advance payments of the Premium Tax Credit or to claim the Premium Tax Credit. Individuals do not need to include the 1095-A with their income tax returns. However, they should retain the form for their tax records.

Who issues the 1095-A form? 

The insurance carrier in the Health Insurance Marketplace issues the 1095-A and reports the same information to the IRS. Employers are not obligated to send these tax forms to their staff. If an employee experiences a delay in getting their form, they should contact the health coverage provider.

What is a 1095-B form?

IRS Form 1095-B (Health Coverage) reports healthcare coverage information to the IRS and taxpayers about individuals (e.g., the taxpayer and their family)—specifically, whether they have the minimum essential coverage required by the Affordable Care Act for the previous year. Prior to 2019, this would mean they were not liable for the individual shared responsibility payment, but since tax year 2019, the Tax Cuts and Jobs Act (TCJA) has reduced the shared responsibility payment to zero.

Who files the 1095-B form?

Insurance providers and self-insured small businesses are required to file Form 1095-B to report details about individuals who were provided with minimum essential coverage. Taxpayers and their dependents receive a Form 1095-B, depending on the circumstances of their healthcare coverage. If the coverage was provided through an insurance provider or a self-insured provider that is not classified as an Applicable Large Employer (an employer with an average of at least 50 full-time employees, also known as an ALE) a 1095-B is issued. Individuals do not have to include this form with their income tax return, but they should save it with important tax documents. 

Who issues the 1095-B form? 

Form 1095-B is distributed by mail to individuals by entities responsible for providing health coverage, including:

• Health insurance providers
• Self-insured employers
• Public health programs (e.g., Medicaid) 
• Medicare

What is a 1095-C form?

IRS Form 1095-C (Employer-Provided Health Insurance Offer and Coverage) reports information about an employee’s health insurance coverage offered by their employer. This form is an annual statement detailing the health coverage available to eligible employees, including the months they were eligible for coverage and the lowest monthly premium they could have paid under the plan.

The primary purpose of IRS Form 1095-C is to document compliance with the Affordable Care Act. The IRS uses the information reported on Form 1095-C to determine if an employer or employee is responsible for any fines for failure to comply with the ACA. The form verifies that individuals, their spouses, and dependents had appropriate health insurance coverage for each month of the year, which is necessary for ACA compliance.

Who files the 1095-C form?

The difference between 1095 A and C is that businesses and self-insured employers with 50 or more full-time employees (Applicable Large Employers) are required to file Form 1095-C with the IRS and provide a copy to employees. The employee copy provides information they need to file their taxes, but it doesn’t need to be submitted to the IRS. Employees should keep it for their tax records. 

Who issues the 1095-C form? 

Applicable Large Employers are required to issue IRS Form 1095-C to each full-time employee, regardless of whether the employee participated in the company health plan. Employers are responsible for reporting this information to the IRS and must retain a copy of issued 1095-Cs. 

Where to get the 1095-A, 1095-B, and 1095-C forms?

Each version of IRS Form 1095 is sent by mail, but the sender and timing of distribution depend on the type of form.

Where to get 1095-A form: This form is issued by marketplace insurers and must be provided to individuals on or before January 31. The information from Form 1095-A is required before filing personal taxes.

Where to get 1095-B form: This form is used by health coverage providers to report certain information to the IRS and taxpayers about individuals who had minimum essential coverage during the previous year. Form 1095-B must be sent to individuals by January 31. 

Where to get 1095-C form: Applicable Large Employers must file this form and provide a copy to employees by January 31. 

Streamline health benefits compliance with Rippling

Rippling is the best way to stay on top of ACA compliance. With Rippling, you can easily and automatically:

• Gather relevant information about your company for reporting to the IRS.
• Generate and file IRS 1094-C tax forms for your company.
• Submit reporting forms to the IRS and any applicable state agencies on time.
• Generate IRS 1095-C forms for all eligible employees and add them to your employees’ Rippling profiles.
• Track all your compliance information, including plans that were offered, insurance-eligible employees, enrollment information, employee hours, and more—all in one place.

Rippling's Benefits Administration software consolidates all your benefits into one system, automating enrollment, deductions, and administration while ensuring compliance.

1095-A vs. 1095-B vs. 1095-C FAQs

What should employees do if they did not receive Form 1095-A, Form 1095-B, or Form 1095-C?

IRS Form 1095-A: This form must be issued by January 31, and employees should receive it by mid-February. The form is sent to employees by their insurance provider in the Health Insurance Marketplace, not the employer. Information from Form 1095-A is required for filing taxes, and if an employee hasn’t received their form by mid-February, they should contact their Marketplace health plan provider. 

IRS Form 1095-B: This form is issued for informational purposes and isn’t required for filing taxes. The form is sent by health coverage providers (insurance companies or certain employers). If it hasn’t arrived by mid-February, employees should contact their healthcare provider or, if employer-sponsored, contact their HR or benefits department or the IRS for guidance. 

IRS Form 1095-C: Applicable Large Employers must send this form to employees by January 31. The form is for informational purposes only and is not required to file taxes. Employees should contact their employer’s HR or benefits department if they don’t receive it by Mid-March. 

How does Form 1095-A affect an individual’s tax return?

Health Insurance Marketplaces issue Form 1095-A to the IRS and individuals enrolled in qualified health plans through the Marketplace. For the IRS, the form provides specific information about these individuals. At the same time, it serves multiple purposes for enrollees: enabling them to claim the Premium Tax Credit (PTC), reconcile the credit with any advance payments of the Premium Tax Credit (advance credit payments), and file an accurate tax return. Form 1095-A is necessary to complete Form 8962, which must be included with the tax return when claiming the Premium Tax Credit.

Can employees receive Form 1095-A, Form 1095-B, and 1095-C all in one year?

Yes. This can occur if the employee had health insurance coverage from multiple providers or experienced changes in their employment or insurance situation during the year. For example, they may have been covered by a marketplace policy at the beginning of the year and a non-marketplace policy later in the same year. If an applicable large employer provides the non-marketplace coverage, then the employee could receive all three versions of Form 1095. 

When do Form 1095-A, 1095-B, and 1095-C need to be filed?

1095-A: Marketplace insurers issue this form to individuals who obtained health insurance coverage through the Marketplace. For the 2024 tax year, insurers must file Form 1095-A on or before January 31, 2025. Information from Form 1095-A is required for filing individual taxes.

1095-B: This form details health coverage and is mailed to employees by the insurer at the beginning of the year. It is for informational purposes only and is not required when employees file taxes. The deadline for insurer filing is February 28 or March 31 if filing electronically. 

1095-C: This form is also for informational purposes only. ​​Applicable Large Employers provide it to full-time employees and those enrolled in their health insurance plan. Employees do not need this form to file their taxes. The deadline for employer filing is February 28 or March 31 if filing electronically.

This blog is based on information available to Rippling as of November 29, 2024.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.