What it Means: Form 1095-C, Line 16

Welcome back! We’re here for Part 2 of ExpressACAForms’s series on lines 14 and 16 of Form 1095-C, Employer-Provided Health Insurance Offer and Coverage.

And since we covered line 14 last time, this post is all about line 16!

Form 1095-C, Line 16
So, as you remember, line 14 indicates to the IRS the type of coverage you offered your employee. Line 16 takes that a step further and indicates to the IRS any safe harbor situations that applied to you/that employee with Code Series 2. It basically answers the “why” question for the type of coverage you chose to offer.

Tax Year 2016 Code Changes
If you remember filling out line 16 this past year, there’s a chance you remember entering code 2I. Not this year! The IRS got rid of code 2I on line 16 of Form 1095-C this year since the safe harbor it represented was exclusive to the 2015 tax year.

Code Series 2
On line 16 of Form 1095-C, you’ll use one code per month (or one code for all 12 months) as it applies to that employee. Here are those codes and what they mean:

• 2A. The employee was not employed during the month indicated. If the employee worked even one day of the month, you are not allowed to use code 2A. Additionally, code 2A should not be used for the month an employee is terminated.
• 2B. The employee was not a full-time employee during the month indicated. If the employee was not a full-time employee and did not enroll in MEC, use code 2B. You’ll also use 2B if the employee was a full-time employee whose coverage ended that month solely because the employee terminated employment.
• 2C. The employee enrolled in the coverage offered. Code 2C cannot be used if code 1G is in line 14 or if the coverage was not MEC. Code 2C also shouldn’t be used for months terminated employees are enrolled in COBRA continuation coverage.
• 2D. The employee is in a section 4980H(b) Limited Non-Assessment Period or an initial measurement period.
• 2E. Use code 2E for any month for which the multiemployer arrangement interim guidance applies to that employee, regardless of any other code in Code Series 2 that may apply.
• 2F. Enter code 2F if section 4980H Form W-2 safe harbor was used to determine affordability for the employee for the year. Code 2F must be used for all months of the year the employee was offered health coverage if it applies.
• 2G. Enter code 2G if section 4980H federal poverty line safe harbor was used to determine affordability for the employee for any months of the year.
• 2H. Enter code 2H if section 4980H rate of pay safe harbor was used to determine affordability for the employee for any months of the year.