Large employers (generally, employers with at least 50 full-time employees, including full-time equivalents employees, in the prior calendar year) may be assessed an employer shared responsibility payment (ESRP) under IRC 4980H(a) if they do not offer health insurance with minimum essential coverage (MEC) to full-time employees (and their dependents) and at least one full-time employee receives a premium tax credit (PTC) under IRC 36B. The ESRP may also be assessed under IRC 4980H(b) if the employer offers MEC to its full-time employees (and their dependents), but at least one full-time employee receives a PTC because the employer's offer of MEC was not affordable or did not provide minimum value or because the employee was not one of the at least 95 percent of full-time employees offered MEC.
Form 1094-C and Form 1095-C are used to report information about offers (or non-offers) of health coverage and enrollment in health coverage to an employee by the employer. ESRP will not be self-reported by the taxpayer but will be assessed by the Exam function based on information reported to the IRS. Form 1094-C and Form 1095-C are used by Exam in determining whether an employer owes an ESRP.
The ESRP assessments are processed on the BMF (Business Master File) under MFT43.
On MFT 43, the assessment posts as a TC 290 .00 and/or a TC 298 for any amount (including zero), with a three-digit reference number which identifies the type of assessment. These reference numbers can be 240, 241, 242, 243, or 244 which identifies the type of assessment (reference number of 240 is the most common). A TC 150 never posts to this module.
