IRS Provides Transition Relief for 2020 Affordable Care Act (ACA) Reporting
December 11, 2020


Highlights


•   The deadline for furnishing individual statements under Sections 6055 and 6056 for 2020 has been extended for 30 days.
•   Good-faith transition relief from penalties has also been extended for a final time for 2020 reporting.
•   The due date for filing returns with the IRS for 2020 is not affected.


Important Dates


March 2, 2021-Deadline for furnishing 2020 Forms 1095-B and 1095-C to individuals
March 1, 2021-Deadline for 2020 filing with the IRS in paper form
March 31, 2021-Deadline for 2020 filing with the IRS electronically



On Oct. 2, 2020, the Internal Revenue Service (IRS) issued Notice 2020-76 to:

•   Extend the due date for furnishing forms under Sections 6055 and 6056 for 2020 from Feb. 1, 2021, to March 2, 2021; and
•   Provide a final extension of good-faith transition relief from penalties related to 2020 information reporting under Sections 6055 and 6056; and
•   Provide additional penalty relief related to furnishing 2020 forms to individuals under Section 6055. Under this relief, employers will only have to provide Form 1095-B to covered individuals upon request.


The due date for filing forms with the IRS for 2020 remains March 1, 2021 (since Feb. 28, 2021, is a Sunday), or March 31, 2021, if filing electronically.


Action Steps

The IRS is encouraging reporting entities to furnish 2020 statements as soon as they are able. No request or other documentation is required to take advantage of the extended deadline.


According to Notice 2020-76, this is the last year that the IRS intends to provide good-faith relief from penalties, since it was intended to be transitional relief only.


Sections 6055 and 6056 Reporting

Sections 6055 and 6056 were added to the Internal Revenue Code (Code) by the Affordable Care Act (ACA).


•   Section 6055 applies to providers of minimum essential coverage (MEC), such as health insurance issuers and employers with self-insured health plans. These entities will generally use Forms 1094-B and 1095-B to report information about the coverage they provided during the previous year.
•   Section 6056 applies to applicable large employers (ALEs)—generally, those employers with 50 or more full-time employees, including full-time equivalents, in the previous year. ALEs will use Forms 1094-C and 1095-C to report information relating to the health coverage that they offer (or do not offer) to their full-time employees.


Extended Furnishing Deadline


The IRS has again determined that some employers, insurers and other providers of MEC need additional time to gather and analyze the information, and prepare 2020 Forms 1095-B and 1095-C to be furnished to individuals.


For 2020, the furnishing deadline was Feb. 1, 2021, Since Jan. 31, 2021, is a Sunday. Notice 2020-76 provides an additional 30 days for furnishing the 2020 Form 1095-B and Form 1095-C, extending the due date from Feb. 1, 2021, to March 2, 2021.


Despite the delay, employers and other coverage providers are encouraged to furnish 2020 statements to individuals as soon as they are able.


Filers are not required to submit any request or other documentation to the IRS to take advantage of the extended furnishing due date provided by Notice 2020-76. Because this extended furnishing deadline applies automatically to all reporting entities, the IRS will not grant additional extensions of time of up to 30 days to furnish Forms 1095-B and 1095-C. As a result, the IRS will not formally respond to any requests that have already been submitted for 30-day extensions of time to furnish statements for 2020.


Impact on Filing Deadline

The IRS has determined that there is no need for additional time for employers, insurers and other providers of MEC to file 2020 forms with the IRS. Therefore, Notice 2020-76 does not extend the due date for filing Forms 1094-B, 1095-B, 1094-C or 1095-C with the IRS for 2020. This due date remains:


•   March 1, 2021, if filing on paper (since Feb. 28, 2021, is a Sunday); or
•   March 31, 2021, if filing electronically.


Because the due dates are unchanged, potential automatic extensions of time for filing information returns are still available under the normal rules by submitting a Form 8809. The notice also does not affect the rules regarding additional extensions of time to file under certain hardship conditions.


Final Extension of Good-faith Transition Relief from Penalties for 2020

Notice 2020-76 also provides a final extension of transition relief from penalties for providing incorrect or incomplete information to reporting entities that can show that they have made good-faith efforts to comply with the Sections 6055 and 6056 reporting requirements for 2020 (both for furnishing to individuals and for filing with the IRS). According to Notice 2020-76, this good-faith relief was intended to be transitional relief. Therefore, this is the last year that the IRS intends to provide this relief.


This relief applies to missing and inaccurate taxpayer identification numbers and dates of birth, as well as other information required on the return or statement. No relief is provided for reporting entities that:


•   Do not make a good-faith effort to comply with the regulations; or
•   Fail to file an information return or furnish a statement by the due dates (as extended) (except as otherwise provided in Notice 2020-76).


In determining good faith, the IRS will take into account whether a reporting entity made reasonable efforts to prepare for reporting the required information to the IRS and furnishing it to individuals (such as gathering and transmitting the necessary data to an agent to prepare the data for submission to the IRS or testing its ability to transmit information to the IRS). The IRS will also take into account the extent to which the reporting entity made reasonable efforts to prepare for this reporting requirement, such as gathering and transmitting the necessary data to an agent to prepare the data for filing or testing its ability to transmit information to the IRS.


In Notice 2019-63 extending the relief for 2019, the IRS requested comments as to whether an extension of good-faith reporting relief under Section 6056 would be necessary for future years and, if so, why. Very few comments were submitted, which indicated to the IRS that this relief may no longer be necessary. In Notice 2019-63, the IRS also requested comments as to whether and how the reporting requirements under Section 6055 should change, if at all, for future years; only one comment was submitted. The IRS is renewing the request for comments related to furnishing requirements under Sections 6055 and 6056. Unless comments are submitted that explain why this relief continues to be necessary, no relief related to the furnishing requirements under Sections 6055 and 6056 will be granted in future years. Comments must be submitted by Feb. 1, 2021.


Penalty Relief Regarding the Furnishing Requirement under Section 6055 for 2020

The individual mandate penalty has been reduced to zero, beginning in 2019. As a result, an individual does not need the information on Form 1095-B in order to calculate his or her federal tax liability or file a federal income tax return. However, reporting entities required to furnish Form 1095-B to individuals must continue to expend resources to do so.


Therefore, Notice 2020-76 provides relief from the penalty for failing to furnish a statement to individuals as required under Section 6055 for 2020 in certain cases. Specifically, the IRS will not assess a penalty under Section 6722 against reporting entities for failing to furnish a Form 1095-B to responsible individuals in cases where the following two conditions are met:


•   The reporting entity prominently posts a notice on its website stating that responsible individuals may receive a copy of their 2020 Form 1095-B upon request, accompanied by an email address and a physical address to which a request may be sent, as well as a telephone number that responsible individuals can use to contact the reporting entity with any questions; and
•   The reporting entity furnishes a 2020 Form 1095-B to any responsible individual upon request within 30 days of the date the request is received. The reporting entity may furnish these statements electronically if it meets the requirements for electronic furnishing.


ALEs that offer self-insured health plans are generally required to use Form 1095-C, Part III, to meet the Section 6055 reporting requirements, instead of Form 1095-B. This 2020 Section 6055 furnishing penalty relief does not extend to the requirement to furnish Forms 1095-C to full-time employees. As a result, for full-time employees enrolled in self-insured health plans, penalties will continue to be assessed consistent with prior enforcement policies for any failure by ALEs to furnish Form 1095-C, including Part III, according to the applicable instructions. However, the 2020 Section 6055 furnishing penalty relief does extend to the requirement to furnish the Form 1095-C to any non-full-time employees enrolled in an ALE’s self-insured health plan, subject to the requirements of the 2020 Section 6055 furnishing penalty relief.


The 2020 Section 6055 furnishing penalty relief also does not affect the requirement or the deadline to file the 2020 Forms 1094-B, 1095-B, 1094-C or 1095-C, as applicable, with the IRS.


For questions or more info, contact SimcoHR.

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5 Questions to Ask About Your 401(k) Administration Process

May 15, 2026
For many employers, managing a 401(k) plan has become more time-consuming than expected. What should feel like a straightforward administrative process often turns into ongoing coordination between payroll systems, retirement providers, HR teams, and compliance partners. The challenge usually is not the retirement plan itself. More often, the friction comes from the systems and processes supporting it. Manual uploads, delayed updates, repeated reconciliation work, and disconnected data flows can quietly create extra administrative burden over time. Because these issues develop gradually, many organizations begin treating them as “just part of the process.” But they do not have to be. As retirement administration continues to evolve, employers are taking a closer look at the operational side of their plans and asking whether their current processes are truly efficient, scalable, and aligned. Here are five questions worth asking about your organization’s 401(k) administration process. 1. Are We Still Manually Uploading Payroll Files? One of the most common inefficiencies in retirement administration is still surprisingly widespread: manually extracting payroll data and uploading files from one system to another every pay period. While this process may seem manageable, it creates unnecessary administrative work and introduces opportunities for error. Payroll teams often spend time formatting files, validating contribution data, and confirming whether updates were successfully processed. Over time, those extra steps add up. Modern payroll integrations can automate much of this process by securely transferring contribution, eligibility, and employee census data directly between systems. That reduces repetitive manual work while helping ensure retirement information stays current and accurate. If your team still relies heavily on manual uploads each pay cycle, it may be worth evaluating whether your current process is creating more administrative lift than necessary. 2. How Many Systems Need to Be Checked to Confirm an Update Went Through? This is where many employers begin to feel the operational strain of disconnected systems. An employee updates their deferral amount. A payroll change is processed. A loan repayment adjustment is made. Then someone has to verify whether the update actually flowed correctly between platforms. In environments where systems are not fully connected, HR and payroll teams often become the “checkpoint” between vendors, manually confirming updates and troubleshooting discrepancies after the fact. This is also where the difference between one-way and two-way integrations becomes important. A one-way, or 180° integration, typically sends payroll information outward to the retirement provider but does not automatically sync updates back into the payroll or HCM system . A two-way, or 360° integration, allows updates to move between systems automatically, helping reduce duplicate work and missed changes. The less time teams spend double-checking systems, the more time they can spend supporting employees and broader business priorities. 3. Could We Easily Pull Accurate Data for Compliance Testing and Reporting? Retirement plans operate within a highly regulated environment, and compliance depends heavily on accurate, timely data. Annual testing and reporting often require employers to provide detailed information including compensation data, contribution amounts, hire dates, demographic information, eligibility records, and more. For organizations using disconnected systems, collecting that information can become a time-intensive process. Missing fields, outdated data, or formatting inconsistencies often lead to repeated file requests and last-minute corrections during annual testing periods. This creates stress not only for HR and payroll teams, but also for plan administrators, TPAs, and recordkeepers responsible for maintaining compliance standards. Integrated payroll and retirement systems help streamline this process by automatically capturing and syncing data throughout the year, improving visibility and reducing the need for manual data gathering when reporting deadlines approach. 4. How Much Time Is HR Spending Fixing Preventable Errors? Many retirement administration issues do not start as major problems. More often, they begin as small discrepancies that require manual follow-up, whether it is a contribution that does not align with payroll data, an incorrect eligibility date, a delayed deferral update, or an incomplete census file. On their own, these issues may seem relatively minor. Over time, however, they create a significant amount of reactive work for HR and payroll teams that are left validating information, correcting inconsistencies, and coordinating between systems and providers. What makes this especially frustrating is that many of these issues are preventable. They are often the result of disconnected systems, delayed synchronization, or processes that rely too heavily on manual intervention. When teams spend large portions of their time validating data, reconciling discrepancies, and coordinating between providers, it becomes harder to focus on strategic priorities like employee engagement, workforce planning, and benefits strategy. Reducing friction behind the scenes can have a meaningful impact on both operational efficiency and the employee experience. 5. Is Our Current Process Built to Scale as We Grow? Processes that work for a smaller workforce can quickly become difficult to manage as an organization grows. More employees mean more payroll activity, more contribution data, more eligibility tracking, and more opportunities for inconsistencies across systems. Without connected infrastructure, administrative complexity tends to grow alongside headcount. That is why many employers are reevaluating whether their current retirement administration processes are sustainable long term. The goal is not simply to “manage” the workload, but to create systems that scale efficiently without increasing manual effort at the same pace. Connected payroll, HR, and retirement systems can help organizations reduce administrative burden, improve accuracy, and create a more streamlined experience for both employers and employees. A More Connected Approach to Retirement Administration A well-run 401(k) plan should not require constant oversight to function smoothly. When payroll, HR, and retirement administration systems work together, organizations gain better visibility into data, fewer manual touchpoints, improved reporting efficiency, and greater confidence in their processes overall. At Simco, we help employers simplify workforce management by aligning payroll, HR, benefits, and retirement administration through more connected systems and support models. For organizations evaluating their current retirement administration process, sometimes the most valuable first step is simply asking the right questions. Looking Ahead Retirement administration will likely continue becoming more data-driven, integrated, and compliance-focused in the years ahead. Employers that take time now to evaluate how information flows between payroll, HR, and retirement systems will be better positioned to reduce operational friction, support employees more effectively, and scale with greater confidence over time.

Finger Lakes Homeowners: Is Your Insurance Ready for Spring and Summer Storms?

April 27, 2026
Living in the Finger Lakes, especially throughout Canandaigua and Ontario County, offers a quality of life that is hard to match. The lakes, the landscape, and the changing seasons are part of what makes this area special. Those same characteristics, however, also create very specific risks to your home and property. Many of these risks are not fully understood until a loss occurs. This overview is meant to help bring clarity before that happens. Heavy Rain and Flooding: A Common Misunderstanding Spring in our region often brings a combination of heavy rainfall and saturated ground, sometimes alongside lingering snowmelt. When the ground can no longer absorb water, it finds its way into basements and lower levels. What many homeowners do not realize: • Standard homeowners insurance does not cover flood damage • Sewer or drain backup coverage is not automatically included • Even minor water intrusion can result in significant repair costs Flooding remains one of the most common and misunderstood gaps in coverage. Summer Storms and Wind Damage Severe weather events have become more frequent and more intense in recent years. Across the Finger Lakes, we regularly see: • Trees falling onto homes or structures • Roof and siding damage from high winds • Power surges impacting appliances and electronics While many of these losses are typically covered, there are important considerations: • Tree removal coverage is often limited • Poorly maintained trees can create complications in claims • Deductibles may be higher than expected, especially for wind-related losses Tornado Activity in Upstate New York Tornadoes are not something most people associate with our region, but they do happen in upstate New York. They are often smaller in scale, but still strong enough to damage roofs, garages, sheds, outbuildings, and surrounding property. In many cases, tornado-related damage is covered under a standard homeowners policy. The bigger concern is whether homeowners have reviewed their limits, deductibles, and property details before a loss occurs. Hail Damage: Often Overlooked Hail damage does not always present itself immediately. Over time, it can: • Compromise roofing materials • Reduce the lifespan of your roof • Lead to leaks or structural issues later on An important detail many homeowners are unaware of: some policies now settle roof claims based on actual cash value rather than full replacement cost, which can significantly reduce claim payouts. Lakefront and Hillside Exposures The natural features that define the Finger Lakes also introduce unique risks: • Shoreline erosion • Slope instability • Ground shifting following heavy rain It is important to understand: • Land itself is not insurable • Earth movement, including landslides, is typically excluded These are among the most significant uncovered exposures in our area. Lightning and Power Surges A single storm can damage electronics, appliances, and home office equipment. While coverage may apply, it is often subject to policy limits, deductibles, and specific conditions. If you work from home or rely on expensive electronics, it is worth reviewing how your policy handles power surge damage before you need to file a claim. What Homeowners Often Learn Too Late After working through claims with families across the region, a consistent pattern emerges: “I thought that was covered.” “No one explained that to me.” “I wish I had reviewed this sooner.” Insurance is not just about having a policy in place. It is about understanding how that policy responds in real-world situations. A Local Approach to Reviewing Your Coverage As part of the Finger Lakes community, we believe homeowners should have a clear understanding of their coverage before they need to rely on it. We offer straightforward, no-pressure coverage reviews that include: • A clear explanation of your current policy • Identification of potential gaps based on local risks • Honest answers to your questions • Guidance on whether any adjustments make sense for your situation Looking Ahead Seasonal weather in the Finger Lakes is predictable in one sense: it will come. The better question is whether your coverage reflects the realities of where you live. Taking the time to review now can help ensure you are prepared when it matters most.

Financial Literacy Month: Why Employers Play a Bigger Role Than They Think

April 9, 2026
April is Financial Literacy Month, and most of the conversation tends to focus on individuals. Budgeting, saving, managing debt, planning for retirement. All important topics, but often framed as personal responsibilities. What gets overlooked is how much of an employee’s financial life is shaped at work. From how pay is structured, to how benefits are communicated, to whether retirement options are understood or even used, employers have a direct influence on how confident and informed employees feel about their finances. It is not always intentional, but it is significant. Where Financial Literacy Shows Up at Work For many employees, the workplace is the primary place where financial decisions are made or reinforced. Think about what flows through an employer: Paychecks and how they are calculated Tax withholdings and deductions Health insurance contributions Retirement plan participation and employer match Bonuses, commissions, and variable compensation These are not small details. They are the building blocks of how employees understand their income, manage expenses, and plan for the future. When those elements are clear and easy to navigate, employees tend to feel more in control. When they are confusing or inconsistent, it can lead to frustration, disengagement, or avoidable financial stress. The Reality: Many Employees Are Still Guessing Even in well-run organizations, it is common for employees to have gaps in understanding. Questions like: “Why did my paycheck change this period?” “What exactly is being deducted from my pay?” “Am I contributing enough to my 401(k)?” “How does my health plan actually impact my out-of-pocket costs?” These are not uncommon, and they are not always asked out loud. When employees are unsure, they often make assumptions or avoid decisions altogether. That might mean underutilizing benefits, delaying retirement contributions, or feeling less confident about their financial situation overall. Why This Matters More Than It Seems Financial literacy is not just a personal issue. It has a direct impact on the workplace, and employees who feel financially uncertain are more likely to: Experience stress that carries into the workday Be distracted or less engaged Delay important decisions like retirement planning Ask more reactive questions that take time to address On the other hand, when employees understand how their pay and benefits work, there is a noticeable shift. Communication becomes easier. Trust increases. Fewer issues escalate into larger problems. It is not about expecting employees to become financial experts. It is about creating an environment where information is clear and decisions feel manageable. Where Employers Have the Most Influence Employers do not need to overhaul their entire approach to make an impact. In many cases, financial clarity improves when existing processes are just a little more intentional. A few areas tend to have the biggest influence: Payroll Transparency Pay statements should be easy to read and consistent. Employees should be able to quickly understand their gross pay, deductions, and net pay without needing to ask for clarification every time something changes. Even small improvements in how payroll information is presented can reduce confusion. Benefits Communication Open Enrollment is not the only time benefits need explanation. Employees often need reminders and context throughout the year. Clear explanations around what plans cover, how contributions work, and how to use benefits in real scenarios can make a meaningful difference. Retirement Plan Engagement Offering a retirement plan is one thing. Helping employees understand how to use it is another. Employers who provide basic education around contribution levels, employer match, and long-term impact tend to see stronger participation and better outcomes. Consistency Across Systems When payroll, benefits, and HR systems do not align, employees feel it. Conflicting information or multiple places to find answers creates friction. Even if the underlying services are strong, the experience can feel disjointed if everything is not connected. Financial Literacy as a Workplace Advantage Financial Literacy Month is a good reminder that supporting employees in this area is not just a benefit. It is part of how a business operates. Employers who prioritize clarity tend to see:  Fewer payroll and benefits questions More confident employees Better utilization of offered benefits Stronger overall engagement It does not require a complete redesign. Often, it is the result of tightening communication, simplifying access to information, and making sure systems are working together. At Simco, this is something we see regularly. When payroll, HR, benefits, and retirement services are aligned, it becomes much easier for employers to provide a clear and consistent experience without adding more administrative burden. A Few Practical Steps to Start With If Financial Literacy Month is a prompt to take action, it does not need to be complicated. A few focused steps can go a long way: Review a sample of employee pay statements and ask if they are easy to understand at a glance Look at how benefits information is shared outside of Open Enrollment and where there may be gaps Check that retirement plan details, including employer match, are clearly communicated and easy to access Identify whether employees have one clear place to go for payroll, benefits, and HR information Ask managers or HR team members what questions they are hearing most often from employees These are simple starting points, but they often reveal where clarity can be improved. Looking Ahead Financial literacy does not need to be a separate initiative. It is already built into the way employers manage pay, benefits, and communication. April is a good reminder to take a closer look at how those pieces are working together. When employees understand their finances at work, they are more confident, more engaged, and better positioned to make informed decisions. That benefits both the individual and the organization over time.

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