Form 1095-C Explained: Who Gets It, What the Codes Mean & Deadlines for 2026–2027

Short answer: Form 1095-C is an IRS form that a large employer (50 or more full-time employees, including full-time equivalents) uses to report what health coverage it offered an employee, month by month. The employer sends one copy to the employee and another to the IRS. It shows what was offered, not whether you signed up.

If you are an employee, a 1095-C usually needs no action from you. If you are an employer, it is one of the most error-prone filings of the year. This guide covers both sides in plain language.

Form 1095-C at a Glance

What Is Form 1095-C Used For?

The ACA requires large employers to offer health coverage that is both affordable and meets a minimum standard. Form 1095-C is how the IRS checks that.

The IRS looks at two things:

1. Did the employer offer coverage to enough of its full-time workforce?
2. Did any employee who was not offered good coverage get a subsidized plan from the Health Insurance Marketplace?

If both answers point to a gap, the employer may owe an Employer Shared Responsibility Payment.

For you as an employee, the form is just a record. It is not a bill, and it is not proof that you currently have insurance. It simply shows what your employer made available to you in that tax year. You can read the IRS overview on its Form 1095-C page.

Who Has to File Form 1095-C?

Only Applicable Large Employers (ALEs) must file it. You are an ALE if you averaged 50 or more full-time employees, counting full-time equivalents, in the previous calendar year. "Full-time" generally means 30 or more hours a week, or 130 hours a month.

A few quick points:

• Employers under the 50-employee line are usually not required to send 1095-C.
• Smaller employers that run a self-insured plan report with Form 1095-B instead.
• Seasonal and part-time headcount can push a business over the line, so calculate it carefully each year.

For many businesses, ACA reporting lands in the same busy window as W-2s, 1099s and year-end payroll reconciliation. Clean books make it far easier. Our bookkeeping services help keep payroll and benefit records organized so the data is ready when reporting season arrives. Getting worker classification right also matters, and our guide on 1099 vs. W-2 explains who counts as an employee.

What Is on a 1095-C? The Three Parts

Part I: Employee and employer information. Names, addresses and tax ID numbers.

Part II: Offer of coverage. This is the heart of the form. It has three lines to read:

• Line 14: a code showing what type of coverage was offered that month.
• Line 15: the employee's cost for the cheapest self-only plan that meets minimum value.
• Line 16: a code explaining why the employer believes the offer was affordable, or why no penalty applies.

Part III: Covered individuals. Filled in only if the employer's plan is self-insured. It lists everyone enrolled (employee, spouse, dependents) and the months each had coverage.

A simple way to remember it: Part II = what was offered. Part III = who was actually covered. An employee can decline coverage completely and Part II will still be filled out.

Line 14 and Line 16 Codes in Plain English

These codes cause the most confusion. Always confirm against the official IRS instructions for Forms 1094-C and 1095-C, because codes and rules can change.

Line 14: what was offered

Line 16: the employer's explanation

Make the three lines agree

Line 14, Line 15 and Line 16 must tell one consistent story for every month. For example, if Line 14 shows a code that requires a dollar amount, Line 15 cannot be blank. If Line 16 claims a safe harbor, Line 15 must support it.

Mismatches are a common reason for IRS notices. A good habit is to run a second review of the codes before filing. Our advisory team can act as that second set of eyes.

Form 1095-A vs. 1095-B vs. 1095-C

If you received both a 1095-A and a 1095-C, keep both. Together they show whether you were also eligible for job-based coverage in the months you claimed a Marketplace credit.

Do You Need Form 1095-C to File Your Taxes?

No. You do not attach Form 1095-C to your federal return, and you generally do not need to type anything from it into Form 1040. The federal penalty for not having coverage has been $0 since 2019, so the IRS no longer asks you to prove coverage on your federal return.

Still, keep it with your tax records for at least three years. It can matter if:

• You live in a state with its own coverage rule. California, Massachusetts, New Jersey, Rhode Island and Washington, D.C. have individual mandates, and your state return may ask about coverage.
• You also received Form 1095-A. The 1095-C helps confirm whether job-based coverage was available during the months you took a premium tax credit.
• A tax agency asks questions. The form is easy proof of what your employer offered.

If you want help sorting out which forms belong with your return, our tax services team can walk you through it.

How Employers Complete Form 1095-C: A 5-Step Checklist

1. Confirm ALE status. Average your full-time and full-time-equivalent employees over the prior calendar year.
2. Track offers month by month. Record who was offered coverage, what type, and what the employee paid.
3. Test affordability. Use one of the IRS safe harbors: W-2 wages, rate of pay, or federal poverty line.
4. Assign Line 14, 15 and 16 entries for each employee and each month.
5. Complete Part III if self-insured, then furnish employee copies and file Form 1094-C, the summary transmittal, with all 1095-Cs.

Example: Suppose an employee is hired on May 12 and is offered coverage that starts on the first day of the month after a 60-day waiting period. January through April will usually show 2A (not employed). The waiting-period months may need 2D. Once coverage is offered, Line 14 shows the offer code and Line 15 shows the employee cost. Each month needs its own careful review. This example is for illustration only, so check the IRS instructions for your exact facts.

ACA Reporting Deadlines

Upcoming: tax year 2026 (filed in 2027)

Late February deadlines roll to the next business day. February 28, 2027 falls on a Sunday, so the date moves to Monday, March 1. Some sources show March 2, so confirm the final dates in the IRS instructions once the 2026 versions are published.

Last season: tax year 2025 (filed in 2026)

Employee copies and paper filing were due March 2, 2026. E-filing was due March 31, 2026.

The website-notice option

Employers do not have to mail a copy to every employee if they post a clear notice on their website saying employees can request one, and then deliver a copy within 30 days of a request (or by January 31, whichever is later). Keep a log of requests so none are missed.

E-filing is almost always required

Employers filing 10 or more information returns in total (W-2s, 1099s and 1095-Cs combined) must file electronically. Most ALEs fall in this group. E-filing goes through the IRS ACA Information Returns (AIR) program.

Practical tip: Do not wait for the last week of March. If the IRS rejects a submission, you will want time to fix and resubmit. Also, some states require employee copies on their own separate schedules, so check those too.

What Happens If an Employer Doesn't File or Files Incorrectly?

There are two separate types of penalties.

1. Employer Shared Responsibility Payments (Section 4980H)

For 2026, as set by IRS Rev. Proc. 2025-26:

The affordability percentage for 2026 is 9.96%, set in IRS Rev. Proc. 2025-25.

2. Information return penalties (Sections 6721 and 6722)

These apply to late, missing, incorrect or incomplete forms, or paper filing when e-filing was required. They are charged per form and adjusted each year. The amount was $340 per return for forms due in 2026, so the cost grows quickly for a mid-sized workforce. Penalties can be higher for intentional disregard.

A coding error can also lead to an IRS Letter 226-J months or even years later. If you receive one, do not ignore it. Our audit support services can help you prepare a response.

Common Mistakes to Avoid

• Miscounting full-time employees and assuming you are below the ALE line.
• Using the wrong Line 14 code for a month, for example when someone changes status mid-year.
• Leaving Line 15 blank when the code requires an amount.
• Skipping Part III on a self-insured plan.
• Missing the e-file requirement and filing on paper.
• Not reconciling payroll and HR data before year-end, so offers and dates do not match.

Most of these come down to data that was never reconciled during the year. Monthly review beats a January scramble.

Frequently Asked Questions

What is a 1095-C form used for? It tells the IRS and the employee what health coverage a large employer offered, to whom, and for which months. The IRS mainly uses it to enforce the ACA employer mandate.

Is Form 1095-C required to file my taxes? No. It is an information form. You do not need it to file your federal return, but you should keep it for your records.

Do I submit Form 1095-C with my tax return? No. Do not attach it. Hold onto it in case a state return, a Marketplace credit calculation, or a tax agency asks for it.

I never enrolled in my employer's plan. Why did I get a 1095-C? Because the form reports what was offered, not what you used. If you were full-time and eligible, your employer must still report the offer. Your Line 16 code will often show the reason, such as a waiting period.

What is the difference between Form 1094-C and Form 1095-C? Form 1095-C is the individual statement for each employee. Form 1094-C is the summary cover form the employer sends to the IRS along with all the 1095-Cs.

Who is exempt from filing Form 1095-C? Employers with fewer than 50 full-time employees (including full-time equivalents) are generally not required to file it. Smaller employers with self-insured plans use Form 1095-B.

What if my Line 14, 15 and 16 codes don't match? Ask your employer or payroll provider to review and correct the form. Mismatched lines are a leading cause of IRS notices, and corrected forms may need to be filed.

Need Help With ACA Reporting?

ACA filings are detail-heavy and deadline-driven. If your team is spending hours on coverage codes, affordability tests, or e-filing, Stratax Advisors can help you organize your records, review your codes and prepare cleaner filings. See our tax services or contact us to talk through your situation.