General Questions
What if a person is self-employed and has no insurance? How is that handled on the tax return and what are the consequences?
A self employed individual who can afford health insurance but has yet to get insurance will be penalized monthly.
The individual could appeal the penalty to the Health Connector if a hardship prevented him or her from purchasing insurance.
What are the employer obligations under the Massachusetts health care mandate?
Employer reporting responsibility information is available at the Commonwealth Health Insurance Connector Authority.
For state health reform law, the only reporting rule for employers to DOR relates to the Form MA 1099-HC.
Carriers will send a report to DOR listing all Form MA 1099-HCs they issued. If an employer is issuing the Form MA 1099-HC to employees, a report will need to be filed with DOR.
For information on this requirement, please see the Instructions for Electronic Filing Form MA 1099-HC
I am an employer with a self-insured health care plan and I need to provide Form MA 1099-HC to my employees. Where can I obtain draft copies of the Form MA 1099-HC?
The Form MA 1099-HC is available on the DOR website.
Form MA 1099-HC Questions
Are residents required to submit Forms MA 1099-HC when filing their income tax returns?
If you are filing a paper return, please attach a copy of your Form MA 1099-HC form to your tax return.
If you have not received a copy of your Form MA 1099-HC, please attempt to obtain one from your insurance carrier. If you are unable to obtain a copy of your Form MA 1099-HC, you may submit your return without the form attached.
Please be advised that this could delay the processing of your tax return. As always, electronic filing is the quickest and most efficient way to file your tax return with DOR.
Is there a standard format for the Form MA 1099-HC?
No. There is no standardized format.
The Form MA 1099-HC may vary depending upon each carrier.
The information fields must be consistent and must convey the information to the taxpayer that is needed on the taxpayer’s Schedule HC.
If an individual calls a carrier/employer to request a copy of a prior year’s Form MA 1099-HC, does a report need to be sent to DOR for the prior year's Form MA 1099-HC?
You can't commingle tax years, and DOR has designed the XML schema to prevent it. You do need to be able to send data for prior tax years, if such data was never sent for a particular tax year.
So, let's say in 2012 a former customer asks you to generate a Form MA 1099-HC for 2007. If the carrier had already sent it in 2007, send DOR nothing new - that data from 2007 will still be here in the DOR database.
If you didn't send anything to DOR electronically in 2007, it should come in its own transmission/file, with the tax year element set accordingly. Carriers may also use the 1099-HC Mapped Data Upload utility to send additions to prior years' data.
If a subscriber has a mailing address for the winter months (e.g., Florida) and a default address for the rest of the year (e.g., Massachusetts), which address should be sent to DOR and used on the Form MA 1099-HC?
It doesn't matter. Just make sure that what is sent to DOR and what is sent to the taxpayer is consistent.
If a dependent has a different mailing address, should the dependent receive a separate Form MA 1099-HC?
The only requirement is that the Form MA 1099-HC be sent to the primary subscriber.
Dependents are not required to receive Form MA 1099-HC.
Carriers may send separate Forms MA 1099-HC to dependents if they so choose.
If a dependent needs to file a Schedule HC, he or she can:
- Obtain the necessary information from the subscriber's Form MA 1099-HC, or
- Request a separate Form MA 1099-HC from the carrier.
If a parent company will be sending out Forms MA 1099-HC for its operating companies, what should appear in Line 1, the parent company name or the individual business entity's name?
It doesn’t matter.
The parent company can list either the:
- Parent company's name or
- Individual business entity's name
so long as what is reported to DOR electronically and what is sent to the taxpayer on Form MA 1099-HC is consistent and the FID numbers are the same.
How many attempts do carriers/employers have to make to deliver letters that are sent back as "undeliverable" via US mail?
This is an internal decision of the carrier. There is no tax information on the Form MA 1099-HC, therefore DOR has no position on mail returned from the post office.
Are carriers/employers required to mail Forms MA 1099-HC to Medicare subscribers?
No. DOR does not require carriers to send Form MA 1099-HC to their Medicare members. This applies to both Supplemental and Replacement plans.
What is the penalty for a health insurance carrier or employer that is obligated to issue Form MA 1099-HC but does not comply?
The 1099 HC is a tax document like any other tax document required to be submitted to the DOR by law and regulation. Failure to do so could subject the employer or carrier to a host of penalties, as provided under MGL. c. 62C § 8B.
Below is the language contained in DOR's regulation.
(9) Penalty for Failure to Provide Documentation of Health Insurance
(a) Pursuant to MGL c. 62C, § 8B, carriers, employers or other sponsors of employment-sponsored health plans that fail to provide written statements to covered individuals or to report to the Commissioner in violation of this section shall be punishable by a penalty of $50 per individual to which the failure relates, not to exceed $50,000 per year per violator.
(b) The Commissioner shall assess the penalties under MGL c. 62C, § 8B as a tax subject to chapter 62C.
File Transmission Questions
Can employers file Form MA 1099-HC information with DOR in paper format?
No. All Form 1099-HCs must be filed electronically with DOR. Most employers satisfy this requirement by uploading an XML Bulk File. This is the simplest way to file multiple Form 1099-HCs. An employer also has the option of entering one Form 1099-HC record at a time, or of importing multiple Form 1099-HC records using an Excel template. Please note, the Excel template is restricted to filing 1,000 Form 1099-HC records or less.
Is there specific software that is required for filing electronically?
No. For companies using the XML bulk file method, DOR provides specifications found in the FORM 1099-HC Bulk File Specifications Handbook. The XML bulk file is in XML format, which is a standard electronic document format used by many companies, including the IRS, for many initiatives. Various XML development tools are available to help in the development of the XML file if the insurance carrier/employer is developing the file in-house. Commercial vendors also exist in the marketplace that could assist if needed. DOR does not recommend any tool or vendor over another. Entering one Form 1099-HC record at a time or importing multiple Form 1099-HC records using an Excel template is done online via DOR’s MassTaxConnect.
I run a small business and our out-of-state Carrier has informed me that it is not filing Healthcare information with DOR on our behalf. Do I need to submit data through the same process that is used by the large Carriers?
Yes.
Contact
- Visit Health Care Reform for more information.
- Call (617) 887-6367 and speak to a business tax representative.
- Send an e-message via Contact US - Trustee Tax.