Line 16 requires one of the codes described below. The information below should provide you with the information you need to make that determination. Our best guidance for these codes is in parenthesis below. Please consult a tax professional or attorney if you have questions.
Take Command Health is not a licensed tax preparer. Please consult a tax professional or attorney if you have questions.
Line 16 Codes
Form 1095-C Line 16 requires a "Section 4980H Safe Harbor and Other Relief" code, also known as "Code Series 2." The list below includes the relevant codes when offering your employees health insurance in the form of an Individual coverage HRA (ICHRA).
2A: Employee not employed during the month (use this code for months that an individual was not employed the entirety of the month).
Enter code 2A if the employee was not employed on any day of the calendar month. Do not use code 2A for a month if the individual was an employee of the ALE Member on any day of the calendar month. Do not use code 2A for the month during which an employee terminates employment with the ALE Member.
2B: Employee not a full-time employee (use this code if an employee was offered the benefit but did not participate and the individual was employed part-time).
Enter code 2B if the employee is not a full-time employee for the month and did not enroll in minimum essential coverage, if offered for the month. Enter code 2B also if the employee is a full-time employee for the month and whose offer of coverage (or coverage if the employee was enrolled) ended before the last day of the month solely because the employee terminated employment during the month (so that the offer of coverage or coverage would have continued if the employee had not terminated employment during the month).
2C: Employee enrolled in health coverage offered (use this code if the individual participated in the HRA, regardless if any other code applies).
Enter code 2C for any month in which the employee enrolled for each day of the month in health coverage offered by the ALE Member, regardless of whether any other code in Code Series 2 might also apply (for example, the code for a section 4980H affordability safe harbor) except as provided below. Do not enter code 2C on line 16 for any month in which the multiemployer interim rule relief applies (enter code 2E). Do not enter code 2C on line 16 if code 1G is entered on line 14. Do not enter code 2C on line 16 for any month in which a terminated employee is enrolled in COBRA continuation coverage or other post-employment coverage (enter code 2A). Do not enter code 2C on line 16 for any month in which the employee enrolled in coverage that was not minimum essential coverage.
2D: Employee in a section 4980H(b) Limited Non-Assessment Period (use this code for months that an individual is in a limited non-assessment period, such as a lookback or waiting period).
Enter code 2D for any month during which an employee is in a section 4980H(b) Limited Non-Assessment Period. If an employee is in an initial measurement period, enter code 2D (employee in a section 4980H(b) Limited Non-Assessment Period) for the month, and not code 2B (employee not a full-time employee). For an employee in a section 4980H(b) Limited Non-Assessment Period for whom the ALE Member is also eligible for the multiemployer interim rule relief for the month, enter code 2E (multiemployer interim rule relief) and not code 2D (employee in a section 4980H(b) Limited Non-Assessment Period).
2F: Section 4980H affordability Form W-2 safe harbor (use this code if an individual is offered the benefit but does not participate and you've used the W-2 Box 1 wage amounts to determine if the offer was affordable).
Enter code 2F if the ALE Member used the section 4980H Form W-2 safe harbor to determine affordability for purposes of section 4980H(b) for this employee for the year. If an ALE Member uses this safe harbor for an employee, it must be used for all months of the calendar year for which the employee is offered health coverage.
2G: Section 4980H affordability federal poverty line safe harbor (Take Command rarely uses the poverty line in calculation of affordability).
Enter code 2G if the ALE Member used the section 4980H federal poverty line safe harbor to determine affordability for purposes of section 4980H(b) for this employee for any month(s).
2H: Section 4980H affordability rate of pay safe harbor (we generally recommend using this code if an individual is offered the benefit but does not participate. When helping our employer clients evaluate whether an ICHRA offer is considered affordable, Take Command team members typically use the rate of pay safe harbor).
Enter code 2H if the ALE Member used the section 4980H rate of pay safe harbor to determine affordability for purposes of section 4980H(b) for this employee for any month(s).