Since late December, 2016, many Applicable Large Employer Members have received IRS Letter 5699 from a Tax Compliance Officer at an address in Florence, Kentucky. The “Dear Taxpayer” letter is headed: “Request for Employer Reporting of Offers of Health Insurance Coverage (Forms 1094-C and 1095-C).” We have assumed the authenticity of these letters.
Each letter tells the recipient that no 2015 Form 1094-C or Form 1095-C was received from the taxpayer ID number appearing atop the letter and instructs the taxpayer to check one of these boxes and return the letter by mail.
[ ] I was an ALE for calendar year 2015 and already filed Form 1094-C and Forms 1095-C with the IRS using the following name __________ and employer identification number (EIN) _______ on date ____.
[ ] I was an ALE for calendar year 2015 and my Form 1094-C and Forms 1095-C are included with this letter. (Do not use this box if you are required to file electronically.)
[ ] I was an ALE for calendar year 2015 and will file my Form 1094-C and Forms 1095-C with the IRS using the following name __________ and EIN ______ by date ___. (If more than 90 days from the date of this letter, explain below under “Other.”)
[ ] I was not an ALE for calendar year 2015.
[ ] Other (Indicate below or attach a statement explaining why you have not filed the required returns and any actions you plan to take.)
[ … ]
If you are required to file information returns under IRC Section 6056, failure to comply may result in the assessment of a penalty under IRC Section 6721 for a failure to file information returns.
If you have questions, please contact the person shown at the top of this letter.
Remember, there are two penalties for each missing Form 1095-C – $250 for failing to deliver it to the employee and another $250 for failing to file it with the IRS. Lesser penalties apply to late filing and certain filing errors. As they say in the Exempt Organizations group, “BOLO” – i.e., Be On the Look-Out.