Form 1095-C is a vital statement many employees will see during tax season. It explains the health coverage an employer offered, when coverage was available, and the lowest monthly premium an employee could have paid. Whether you work for a large hospital system that contracts with UnitedHealthcare or a small business using Gusto for payroll, understanding this form helps you verify coverage and avoid surprises.
- Who receives the form and why it matters
- Key items to check before you file
- What to do if information is incorrect
What Is Form 1095-C and Why Employer-Provided Coverage Matters
Form 1095-C, titled Employer-Provided Health Insurance Offer and Coverage, documents the health insurance an Applicable Large Employer offered to eligible employees. The obligation to send these forms began with the Affordable Care Act and has applied since the 2015 tax year.
The form is not a tax bill, but it helps the IRS determine eligibility for premium tax credits and confirms whether employers complied with their coverage obligations.
- Form 1095-C shows offers of coverage, not the actual claims paid.
- It helps employees check whether they were offered affordable coverage.
- It supports IRS enforcement of employer responsibilities under the ACA.
Knowing what the form represents helps you treat it as a verification tool rather than a tax requirement you must attach to your return. This perspective prevents unnecessary worry when you first open the envelope.
Who Must File: Defining Applicable Large Employers (ALEs)
The law requires only certain employers—called Applicable Large Employers (ALEs)—to prepare and distribute Form 1095-C. An employer becomes an ALE when it has at least 50 full-time employees or full-time equivalents (FTEs).
Full-time counts are based on working at least 30 hours per week; FTEs combine multiple part-time hours to equal full-time status. For example, two employees working 15 hours each create one FTE.
- Companies with 50+ full-time workers are ALEs and must send 1095-C forms.
- Payroll providers like ADP, Paychex, Zenefits, and Gusto often help employers calculate FTEs and prepare filings.
- Small employers under the 50 threshold generally are not required to file 1095-C.
For HR managers, tracking hours precisely is the core compliance task—miscounts can change an employer’s obligations and trigger penalties.
What Information Appears on Form 1095-C: How to Read Each Section
The 1095-C identifies the employee, the employer, the months the employee was eligible for coverage, and the cost of the cheapest monthly premium offered. It does not prove you had coverage, but it shows what was offered.
Key boxes on the form include employee details, employer information, the code indicating the offer type for each month, and the Employee Required Contribution—the cheapest monthly premium for self-only coverage.
- Employee and employer names and EIN
- Which months the employee was eligible for coverage
- The lowest monthly premium for single coverage (Employee Required Contribution)
If your employer did not offer coverage, the form will indicate that, and the IRS uses this data to assess potential employer penalties—so accuracy matters.
Difference Between 1095-C and 1095-B: Who Sends Which Form?
Form 1095-C documents the offer of coverage from an employer. By contrast, Form 1095-B reports actual coverage provided to an individual and lists family members covered. Insurers such as UnitedHealthcare, Aetna, Blue Cross Blue Shield, Cigna, Kaiser Permanente, and Humana typically send 1095-B forms when they administer coverage.
In self-insured employer arrangements, the employer acts as the insurer and may send both a 1095-C and 1095-B, sometimes combined into a single transmittal.
- 1095-C: Employer’s offer of coverage (sent by ALEs).
- 1095-B: Actual coverage details (sent by carriers or self-insured employers).
- Self-insured employers can issue combined information to simplify employee records.
Understanding who sends which form clarifies whether you should expect one or both documents and prevents confusion during tax filing.
Deadlines, Penalties, and What Employers Must Send to the IRS
Employers must distribute 1095-C forms to employees by the end of January for the previous calendar year; for example, forms covering 2024 were to be sent to employees in January 2025. Employers also file copies with the IRS, usually accompanied by Form 1094-C, the transmittal summary.
Paper filing deadlines differ from electronic: paper submissions typically have an earlier deadline than electronic filings, and employers with 250 or more returns generally must file electronically.
- Employee copies: delivered by end of January (year after coverage).
- IRS filing: paper deadline in late February; electronic filing extends into late March.
- Employers with 250+ forms are required to file electronically; smaller employers may choose either method.
Missing deadlines can lead to penalties, though relief or waivers may apply in some circumstances; employers often rely on payroll vendors like ADP or Paychex to meet these deadlines and avoid fines.
Practical Steps After You Receive a 1095-C
When your envelope arrives, first confirm personal details and the months listed for eligibility. If you declined coverage, you should still receive a 1095-C showing that an offer was made; this is normal and expected.
Keep the form with your records. You generally do not need to attach it to your tax return, but you may need it if the IRS questions your coverage or your eligibility for premium tax credits.
- Verify names, Social Security number (or SSN ending), and employer information.
- Compare with any 1095-B you received from insurers like Cigna or Blue Cross Blue Shield.
- Contact your employer or payroll provider (for example, Zenefits or Gusto) to correct errors.
Accurate records reduce the chance of a later notice from the IRS and make tax filing smoother if you claim a premium tax credit or need to document coverage.
Common Employer Issues and How to Fix Them
Employers sometimes misclassify workers, miscalculate FTEs, or miss filing deadlines—errors that cascade into employee confusion. Payroll platforms and HR vendors provide tools to reduce these mistakes, but human oversight remains essential.
When employers are self-insured, they must coordinate with benefits administrators to ensure both 1095-C and 1095-B information are correct and timely. If errors occur, corrected forms should be issued promptly to limit IRS exposure.
- Miscounted hours can change ALE status—double-check FTE calculations.
- Missing or incorrect forms require timely corrected filings.
- Engage a tax professional or services like live tax assistance to evaluate penalty exposure and potential waivers.
Proactive auditing of payroll and benefits data before year-end is the best defense against late filings and penalties.
Real-World Example: GreenLeaf Tech’s First Year as an ALE
GreenLeaf Tech crossed the 50-employee threshold in 2024 and became an ALE. Their HR lead used Paychex to recalculate FTEs and engaged a benefits coordinator to reconcile offers from carriers including Kaiser Permanente.
They issued 1095-C forms to all eligible staff in January 2025 and filed the 1094-C transmittal with the IRS on time. When one employee flagged an incorrect month of eligibility, GreenLeaf issued a corrected 1095-C within weeks to avoid follow-up.
- Step taken: audit hours, confirm offers, send corrected forms when needed.
- Result: avoided potential penalties and maintained clear employee communication.
- Takeaway: timely internal controls and vendor partnerships reduce compliance risk.
Practical readiness—staff training, vendor support, and quick corrections—keeps small companies compliant as they scale.
Key Insight: Treat Form 1095-C as verification of offers; check it carefully, store it with your tax records, and request corrections promptly when needed.
Questions Employees Commonly Ask
Below are the most useful answers to questions people raise when they find a 1095-C in their mail.
Do I need to attach Form 1095-C to my tax return?
No. You do not attach the form to your return, but keep it with your records in case the IRS asks for proof of an offer of coverage. If you applied for a premium tax credit, the information helps verify eligibility.
- Keep the form for at least three years.
- Use it to reconcile any premium tax credit claims.
What if my employer says they never offered coverage but I received a 1095-C?
Contact HR immediately. It may be a clerical error or an outdated record. Employers that didn’t offer coverage should indicate that on the form; if they did offer it, the form documents that offer.
- Request a corrected form when needed.
- Compare with any 1095-B from carriers to confirm actual coverage.
Who sends the 1095-B versus the 1095-C?
Insurance carriers like UnitedHealthcare, Aetna, and Humana generally send the 1095-B. Employers send the 1095-C; if the employer is self-insured, it may send both forms.
- Expect carrier-sent 1095-B for actual coverage details.
- Expect employer-sent 1095-C for offers of coverage.
What are the employer filing deadlines and penalties?
Employee copies should be distributed by the end of January following the coverage year. Employers file with the IRS, usually via an accompanying 1094-C, with paper and electronic deadlines varying by method and volume. Missed deadlines can trigger penalties, though waivers may apply in specific cases.
- Watch the January (employee) and February/March (IRS) timelines.
- Large filers generally must file electronically to meet compliance.
Who can help if my employer is unresponsive?
Start with your payroll or benefits vendor—platforms such as Zenefits, Gusto, ADP, or Paychex often provide support. If issues persist, consult a tax professional who understands ACA reporting and potential remedies.
- Contact your HR or benefits administrator first.
- Escalate to a tax advisor for disputes involving penalties or corrections.