ACA Forms Understanding Form 1095-C Codes: A Guide for Lines 14 and 16

Image of Form 1095-C Header Section

It's common for employers to find deciphering and completing lines 14-16 of Form 1095-C codes challenging. Incorrectly reported codes on Form 1095-C can lead to significant penalties for employers.

We have compiled a user-friendly guide to assist employers in navigating Line 14 & 16 Codes, thereby avoiding such pitfalls.

A Closer Look at Form 1095-C Part II

Image of Form 1095-C Part II Employee Offer of Coverage

What is Form 1095-C?

Form 1095-C is an information return filed by employers with at least 50 full-time + full-time equivalent employees. These employers are known as 'Applicable Large Employers' or ALEs by the IRS. This form tells the IRS if the employer met ACA guidelines for the healthcare coverage they offer, and it requires that employees receive a recipient copy.

Applicable Large Employers

at least 50 full-time + full-time equivalent employees for all EINs added together that share a common owner

For more info on Tax Year 2023 Form 1095-C, click here

We also recommend checking out the IRS.gov ACA FAQ, which contains many common 1095-C questions in an easy-to-understand format.

Understanding Line 14 of Form 1095-C: Offer of Coverage

Image of Form 1095-C Line 14

In Line 14, employers are expected to use the applicable Series 1 codes (1A-1U) to describe the kind of health insurance offered to an employee, their spouse, and dependents.

If an employee qualifies for health benefits during any month of the year, then Line 14 should be populated for each month, even when an employee is not employed.

Series 1 Codes (Line 14)

These codes provide information about the health coverage offered by the employer, including whether it was a qualifying offer and whether coverage was offered to the employee's spouse and dependents.

Includes codes: (1A, 1B, 1C, 1D, 1E, 1F, 1G, 1H, 1I, 1J, 1K, 1L, 1M, 1N, 1O, 1P, 1Q, 1R, 1S, 1T, 1U)

Read more about 1095-C Codes.

Series 1 Code Definitions

Code Definition

1A

Qualifying Offer

1B

Minimum Essential Coverage (MEC) providing Minimum Value (MV) offered to Employee (EE) only
Spouses and dependents excluded from offer

1C

Spouse excluded from offer
MEC providing MV offered to EE and at least MEC offered to dependents (not spouse)

1D

Dependents excluded from offer
MEC providing MV offered to EE and at least MEC offered to spouse (not dependents)

1E

MEC providing MV offered to EE and at least MEC offered to dependents and spouse

1F

MEC not providing MV offered to EE; or EE, spouse, and/or dependents

1G

Self-insured coverage offered to a non-employee individual or a non-Full-Time Employee for any month of the year

1H

No offer of coverage

1J

Conditional Offer

1K

Conditional Offer

For broken-down examples of ACA Code Series 1 on Form 1095-C, download our PDF Code Series 1 Guidance.

ICHRA Code Definitions

Code Definition

1L

ICHRA offered to Employee (EE) only
Affordability is determined by using EE's primary residence location ZIP code

1M

ICHRA offered to EE and dependents (not spouse)
Affordability is determined by using EE's primary residence location ZIP code

1N

ICHRA offered to EE, spouse, and dependents
Affordability is determined by using EE's primary residence location ZIP code

1O

ICHRA offered to EEs only
Using the EE's primary employment site ZIP code affordability safe harbor

1P

ICHRA offered to EE and dependents (not spouse)
Using the EE's primary employment site ZIP code affordability safe harbor

1Q

ICHRA offered to EE, spouse, and dependents
Using the EE's primary employment site ZIP code affordability safe harbor.

1R

ICHRA that is NOT affordable offered to EE; EE and spouse, and/or dependents

1S

ICHRA offered to an individual who was not an FTE

1T

ICHRA offered to EE and spouse (not dependents)
Affordability is determined using EE's primary residence location ZIP code

1U

ICHRA offered to EE and spouse (not dependents)
Using EE's primary employment site ZIP code affordability safe harbor

For broken-down examples of ACA IRCHA Codes on Form 1095-C, download our PDF Code IRCHA Series Guidance.

Breaking Down Line 15 of Form 1095-C: Employee Required Contribution

Image of Form 1095-C Line 15

On Line 15, employers are required to report the employee's monthly contribution amount.

The amount reported may not reflect the actual cost of the medical plan the employee enrolled in but instead should show the required contribution amount for the lowest-cost, self-only plan offered by the employee.

Line 15 should only be completed when certain codes were entered in line 14. If applicable, enter the Employee Required Contribution amount for the corresponding boxes in which codes 1B, 1C, 1D, 1E, 1J, 1K, 1L, 1M, 1N, 1O, 1P, 1Q, 1T, or 1U were entered on line 14.

Line 16 Codes - Section 4980H Safe Harbor Codes and Other Relief for ALE Members

Image of Form 1095-C Line 16

The codes on Line 16 provide the IRS with further details regarding the employment and coverage status of the employee if the employer met certain affordability safe harbors and other information.

Series 2 Codes (Line 16)

Provide additional details about the employee's employment status, such as whether the employee was not employed or was not full-time during certain months, whether the employee was enrolled in coverage, or whether the employer is eligible for transition relief.

Includes codes: (2A, 2B, 2C, 2D, 2E, 2F, 2G, 2H, 2I)

Read more about ACA Codes.

Series 2 Code Definitions

Code Definition

2A

The employer did not employ this person for any day during the calendar month

2B

The employee was not full-time for this month

2C

The employee enrolled in the offered coverage

2D

The employee was in an LNAP for the month

2E

The employer is eligible for the multi-employer interim relief rule

2F

The coverage is affordable based on the Form W-2 safe harbor

2G

The coverage is affordable based on the FPL safe harbor

2H

The coverage is affordable based on the Rate of Pay safe harbor

For broken-down examples of ACA Code Series 2 on Form 1095-C, download our PDF Code Series 2 Guidance.

Understanding Line 17 - ZIP Code

Image of Form 1095-C Line 17

Line 17 was introduced by the IRS when ICHRA codes were added. Employers are required to enter the ZIP code for any employees offered an ICHRA plan.

The ZIP code entered is contingent on the code used. These codes specify whether the affordability of the coverage was based on the employee's primary residence or work location.

Use the ZIP code of the employee's residence if the following codes were used in line 14:

  • 1L

  • 1M

  • 1N

  • 1T

Use the ZIP code of the employee's primary site of employment if the following codes were used in line 14:

  • 1O

  • 1P

  • 1Q

  • 1U

Click here to learn more about 1095-c instructions.

Looking for a downloadable copy of ACA Codes? Make sure to download our PDF copy of Form 1095-C Code Guidance.

How Do You File ACA Forms Online?

Generally, ACA filing is handled by self-filing or by using an ACA Software provider:

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  • Simple format for data import (like Excel)
  • Can often use your payroll files directly
  • No testing, TCC, or IRS account required
  • Can help with questions/coding

Self-Filing

  • Format requires custom software development
  • Filing system can be slow and unreliable
  • Requires testing, TCC, and personal info
  • Errors and issues reported can be cryptic

Learn more about filing ACA Forms online.

Can I submit ACA 1095 Forms with BoomTax?

BoomTax will streamline your ACA filing process in 3 simple steps!

Import Your Data

You can import your data as Excel, XML, or use files from popular payroll providers like QuickBooks, UKG, ADP, and many more.

Step-By-Step Wizard

We walk you through the process with no complicated jargon. You can also live chat with a real person as you work on your filing for hands-on help.

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