If you are an employer and provide your staff with health insurance coverage, you need to be aware of the New Jersey state individual mandate that comes into effect for Tax Year 2019.

The changes relate to New Jersey 1095 reporting and mandate filing.

The Tax Year 2019 is the first year that the New Jersey Health Insurance Market Preservation Act (Market Preservation Act) comes into force.

The New Jersey Health Insurance Market Preservation Act is a continuation of the Affordable Care Act (ACA).

The ACA requires employers that supply their employees with healthcare coverage to file a report to verify this.

This law aims to provide third-party verification and ensure that everyone in the state has an adequate level of health coverage, or if applicable, an exemption.

The New Jersey Health Insurance Market Preservation Act ensures that New Jersey residents are purchasing health coverage and that the state’s health insurance market remains stable enough to provide New Jersey residents with affordable healthcare coverage.

Who is Affected by New Jersey ACA 1095 Reporting and Mandate Filing?

The New Jersey ACA 1095 reporting and mandate filing relates to individuals that pay New Jersey’s income tax.

Employers that provide health coverage for employees that pay New Jersey’s income tax are required to verify this via 1095 forms.

This new law applies to both full-year New Jersey residents, along with part-year New Jersey residents.

Both types of residents will require a 1095 form to be filed confirming their health coverage.

In 1095 filing terms, a part-year resident is defined as a primary enrollee that has lived in the State of New Jersey for at least 15 days of any month during Tax Year 2019.

It is crucial that employers located out of state also comply with the new rules.

Businesses that operate outside of New Jersey but employ New Jersey residents must also comply with 1095 reporting, so they need to be aware of the mandate and its requirements.

This is a crucial point to note, as it is the employer’s responsibility to ensure that they file 1095 forms for every employee that requires one.

What Forms and Information are Required by the State?

1095-A forms are issued by the federal government to those who purchased an individual plan at HealthCare.gov or the Health Insurance Marketplace.

To meet the requirements of the new mandate, New Jersey requires that for Tax Year 2019, Form 1095-B, and 1095-C are filed to the state.

Form 1095-B, Health Coverage or Form 1095-C, Employer-Provided Health Insurance Offer and Coverage should be filed for employees that are either part-year or full-time residents in New Jersey.

The form that is required will depend on several factors, including the size of the company and the type of coverage plan that it offers.

Which Forms are Required From Fully-Insured Employers?

Form 1095-B, Health Coverage is generally used for employees working for companies that are fully insured.

This includes companies that are Applicable Large Employers (ALEs) employing over 50 full-time workers or equivalent, and to companies that are Non-Applicable Large Employers (Non-ALE) and employed less than 50 full-time employees during the previous calendar year.

Employers that are enrolled on a multi-employer plan and fully-insured will typically also need to file Form 1095-B.

Which Forms are Required From Self-Insured Employers?

If employers are self-insured, they will need to file either a Form 1095-B or a Form 1095-C depending on the criteria they meet.

Self-insured employers that are a single company and an Applicable Large Employers (ALE) member will be required to file Form 1095-B or Form 1095-C.

Self-insured companies that have employed fewer than 50 employees over the past calendar year, and are therefore classed as Non-Applicable Large Employers (Non-ALE) will be required to file a Form 1095-B for each employee covered by the plan.

Companies that are self-insured and are part of a multi-employer plan will need to file a Form 1095-B for each employee that is covered by the plan.

When is the Deadline for Submitting the Forms?

Coverage providers must send out the required 1095 form to their primary enrollees by the fixed deadline, which is March 2, 2020.

The deadline for transmitting 1095 forms back to the New Jersey Division of Taxation is March 31, 2020.

Where do the Forms Need to be Sent?

Completed forms will need to be sent electronically to the State of New Jersey; it is not possible to send paper copies.

To submit your forms, you will need to use the Division of Revenue and Enterprise Services’ (DORES) MFT SecureTransport service.

Transmitting the forms via DORES is the required method for anyone filing more than 100 forms. An MFT SecureTransport service account is required to submit the forms.

If you do not have an account currently, you can request one by contacting DORES, who will also be able to offer guidance for submitting the forms, if needed.

When submitting your forms, you will need to ensure that the file size is below 12MB.

Otherwise, you will need to split the submission into smaller files. Zip files are not an acceptable way to transmit your forms.

Once files have been submitted via the MFT SecureTransport service, a submission receipt will be issued to the email address associated with the MFT Secure Transport service account to confirm that your submission has been received.

If you have less than 100 forms to be submitted, this can be done one form at a time, by using the Fillable Form NJ-1095 instead if you wish.

What are the Coverage Provider’s Responsibilities?

To comply with the New Jersey Health Insurance Market Preservation Act, coverage providers must ensure that all applicable employees are sent 1095 reporting forms by the March 2, 2020 deadline, and that the forms are submitted to the New Jersey Division of Taxation by the March 31, 2020 deadline.

Both fully-insured and self-insured employers will need to contact their insurer or multi-employer plan to be sure that the 1095 forms will be submitted before the deadline.

Employers must remember that they are responsible for ensuring that forms are submitted on time.

There was also a recent update in NJ regarding New Jersey transit commuter tax benefits.

You can read our post on the topic by following this link.