Every February, ACA brokers field calls from clients holding a 1095-C and asking why they got a form for a plan they never enrolled in. The answer is on line 14. The 1095-C documents an offer of coverage, not an enrollment. Understanding the difference between the 1095-B, the 1095-C, and the 1095-A determines how you handle every tax-season call from here through March.
Key Takeaways
- Form 1095-B (IRC §6055) confirms actual health coverage was provided. It comes from insurers, Medicaid, CHIP, and small employers with fewer than 50 FTE.
- Form 1095-C (IRC §6056) documents the coverage offer from an applicable large employer (ALE with 50+ FTE). A client receives it regardless of whether they enrolled in the employer plan.
- A client who declined employer coverage and enrolled on the Marketplace can receive both a 1095-C and a 1095-A for the same year. Both are needed to complete the Form 8962 reconciliation.
- Neither the 1095-B nor the 1095-C is attached to the federal tax return. Only the 1095-A is used on Form 8962 to reconcile APTC.
- Line 14 of the 1095-C identifies the type of coverage offered. Line 15 shows the monthly employee premium for self-only coverage. Line 16 shows whether a safe harbor applies.
The three forms and what each one actually reports
Congress created two separate reporting regimes for health coverage under the ACA. Section 6055 of the Internal Revenue Code requires any entity that provides minimum essential coverage to report that coverage to the IRS and to the individuals covered. That produces Form 1095-B. Section 6056 requires applicable large employers (ALEs) with 50 or more full-time equivalent employees to report the health coverage they offered to full-time employees. That produces Form 1095-C. The Marketplace produces Form 1095-A separately under section 36B to document Marketplace enrollment and APTC.
| Attribute | Form 1095-B | Form 1095-C | Form 1095-A |
|---|---|---|---|
| IRC authority | §6055 | §6056 | §36B (ACA) |
| Issued by | Insurers, Medicaid/CHIP administrators, small employers (<50 FTE) | Applicable large employers (50+ FTE) | Marketplace (federal or state-based) |
| What it documents | Actual minimum essential coverage provided month by month | Coverage offered, employee cost for self-only, enrollment status | Marketplace plan enrollment, monthly premiums, APTC received |
| Who receives it | Any individual covered under the reported plan | Full-time employees of the ALE, regardless of enrollment decision | Anyone enrolled in a Marketplace plan |
| Required for Form 8962? | No — retain as a record | No — retain as a record | Yes — drives the APTC reconciliation |
| IRS deadline to furnish | March 3 (paper) or March 31 (electronic) | March 3 (paper) or March 31 (electronic) | January 31 |
The 1095-A is the only form that gets used on a tax return. It feeds Form 8962, which reconciles the APTC the client received during the year against the Premium Tax Credit they were actually entitled to. For a full walkthrough of that process, see the guide to Form 1095-A and Form 8962.
Why a client can get a 1095-C for a plan they never enrolled in
This is the most common source of client confusion in February. An ALE is required to furnish a 1095-C to every full-time employee, regardless of whether the employee enrolled in the employer plan. A client who waived employer coverage and enrolled on the Marketplace will still receive a 1095-C from their employer. It documents that the offer was made. It says nothing about whether they took it.
Line 14 of Part II on the 1095-C contains the offer code. Code 1H means no offer of minimum value was made, or the offer was below minimum value. Any other code starting with 1A through 1I means an offer was made. Line 15 shows the monthly employee cost for self-only coverage. Line 16 shows which safe harbor the employer is claiming, if any. Brokers who know these three lines can decode the relevant tax form information in about 30 seconds.
Line 14 offer codes and what they mean for APTC
| Code | What It Means | APTC Implication |
|---|---|---|
| 1A | Qualifying offer (minimum value, affordable for 2014 FPL) | Employee generally ineligible for APTC if enrolled in employer plan |
| 1B | Minimum value offered to employee only | Affordability test still applies. Compare line 15 to 9.02% of income. |
| 1E | Minimum value offered to employee, spouse, and dependents | Family coverage offered; self-only cost on line 15 still governs employee affordability. |
| 1H | No offer of coverage (or offer below minimum value) | Employee may be eligible for APTC if income qualifies. Employer may owe ALE penalty. |
Partial list of common offer codes. IRS Instructions for Forms 1094-C and 1095-C contain the complete code set. The 9.02% affordability threshold applies for tax year 2026.
The scenario that creates reconciliation problems is code 1A or 1B with a line 15 amount below the affordability threshold, combined with a 1095-A showing APTC was received. The IRS sees both forms. If the employer offer was affordable and the employee received APTC, Form 8962 will show a repayment amount. Brokers should check the affordability math against the employer plan before enrolling a client on the Marketplace and accepting APTC.
When a client has both a 1095-C and a 1095-A
This happens more often than brokers expect. A client who was on an employer plan from January through June and switched to a Marketplace plan from July through December will receive both. The employer issues a 1095-C covering all 12 months (since they were a full-time employee all year). The Marketplace issues a 1095-A covering July through December. Form 8962 uses only the 1095-A data. The 1095-C is retained but not used on the return.
The more complicated version: a client who waived employer coverage and was on a Marketplace plan all year. They receive a 1095-C from the employer for the offer and a 1095-A from the Marketplace for the enrollment. The 1095-C records the offer that was declined. The 1095-A records the plan that was actually used. Form 8962 uses the 1095-A. The broker's job is to make sure the client does not try to reconcile the 1095-C on Form 8962, which is not its purpose.
The income reconciliation connection
The 1095-A feeds Form 8962, which compares the APTC the Marketplace advanced during the year against the client's actual annual income. If the client's income ended up higher than projected, they owe back some APTC. If income was lower, they may get a credit. Brokers who remind clients to report mid-year income changes to the Marketplace reduce the size of these reconciliation surprises. For the full workflow, see how to handle mid-year income changes and APTC.
Tools like Inshura and GetInsured do not surface this reconciliation math at the point of enrollment. Confirming that the APTC amount aligns with a realistic income projection is a broker conversation, not a software function.
What brokers should do in February and March
Proactive brokers send a short email in January to every Marketplace client with three points: check for a 1095-A on Healthcare.gov (or the state exchange portal), contact the broker if you received any other health coverage forms, and do not file Form 8962 until you have the 1095-A in hand. That single email reduces the volume of confused calls in February by a meaningful amount and keeps the broker positioned as the person who knew this was coming.
FAQ
Questions brokers and clients ask about the 1095-B and 1095-C tax forms.
My client got a 1095-C but they were on a Marketplace plan all year. Do they need to do anything with it?
They should retain the 1095-C as a record but they do not attach it to their tax return and do not enter its information on Form 8962. The 1095-A from the Marketplace is what drives the Form 8962 reconciliation. The 1095-C simply documents that their employer made an offer. If the employer's offer was affordable under the ACA affordability test and the employee received APTC anyway, the IRS may flag a discrepancy. In that case the broker should review the situation carefully before the client files.
Can a client receive both a 1095-C and a 1095-A for the same year?
Yes, and it is more common than brokers expect. A client who switches from an employer plan to a Marketplace plan mid-year, or who declines employer coverage and enrolls on the Marketplace instead, may receive both. The 1095-C from the employer covers the period the offer was made. The 1095-A covers the months the client was enrolled on the Marketplace. Both are needed for the client's records, but only the 1095-A is used on Form 8962. The broker's guide to Form 1095-A and Form 8962 reconciliation covers the full process.
What does line 15 on the 1095-C actually mean for APTC?
Line 15 shows the monthly employee cost for the lowest-cost self-only plan that provides minimum value. This is the number used to determine whether the employer offer was affordable under the ACA 9.02 percent household income threshold for 2026. If the line 15 amount divided by the employee's monthly household income is below that threshold, the offer is considered affordable and the employee is not eligible for APTC. If the line 15 amount is above the threshold, the offer fails affordability and the employee may claim APTC on a Marketplace plan.
Does an employee need to file Form 8962 if they only received a 1095-C and no 1095-A?
No. Form 8962 is only required when a taxpayer received APTC during the year or is claiming the Premium Tax Credit. A client who was covered only by an employer plan and received a 1095-C but no 1095-A does not file Form 8962. They retain the 1095-C as proof of coverage and report minimum essential coverage on their return as required by any applicable state individual mandate.
What should a broker do if a client's 1095-A has incorrect data?
The client should contact the Marketplace directly to request a corrected 1095-A. The Marketplace will issue a corrected form if there is a documented error in the plan information, premium amounts, or APTC paid. The client should not file Form 8962 using incorrect 1095-A data, as this creates a reconciliation mismatch with IRS records. Tax filing should be delayed until the corrected form arrives. For context on how income changes affect APTC reconciliation more broadly, see the guide on mid-year income changes and APTC.
