1095-C Part III: Employer Review of Covered Individuals

Part III is completed for an ALE member's applicable employer-sponsored self-insured coverage. It is not completed for enrollment solely under an insured group health plan. If the employer offers both arrangements, identify the enrolled plan for the particular employee before selecting records for Part III.

Small self-insured employers outside ALE reporting generally use the B-series forms instead. Nonemployee coverage and HRAs can require additional routing decisions. Record those decisions separately so a general employee import does not force every covered person into the same form family.

List the employee if enrolled and include family members actually covered through that enrollment. A dependent listed in HR for another purpose may never have enrolled in medical coverage. Conversely, a covered spouse can belong in the administrator's enrollment data even when a payroll export contains no spouse fields.

Use an internal relationship key that connects each covered person to the employee or other responsible enrollment record. Review changes in names, birth dates and relationships without treating a name difference as proof of a different person. Keep the original source identifier available to resolve duplicates and administrator corrections.

Check each covered individual's name and SSN or other applicable TIN. The instructions allow a date of birth in the specified circumstances when a covered individual's SSN or TIN is unavailable. That alternative does not remove the need to follow applicable solicitation requirements, and it does not authorize substituting a birth date for every employee SSN in Part I.

Mark incomplete records as exceptions with a specific source request and owner. Do not populate repeated digits or copy the employee's identifier onto a dependent. Separate the data used for the IRS submission from permitted truncation on furnished copies, and restrict access to the full identifying information.

Apply the Part III rule for a person covered for at least one day in the month. This differs from the all-days enrollment condition generally associated with line 16 code 2C. A partial-month dependent enrollment can therefore create a Part III month without proving that the employee qualifies for every other monthly code.

Review starts, terminations, retroactive changes and overlapping administrator records. Use the All 12 Months coverage box only when the covered person meets the Part III requirement in every month. A year-end active flag is not enough to establish January coverage, and a termination flag does not erase earlier covered months.

Fictional Harbor Foods is an ALE member with a self-insured plan. Employee A and an enrolled spouse have coverage from January 1 through December 31, 2025. A child is added with coverage effective April 18 and remains covered through year-end. The administrator confirms that the dates represent actual coverage.

The employee and spouse each have 12 covered months, and the child has 9. The 33 person-month total is an internal reconciliation measure, not a separate amount entered on Form 1095-C. The preparer compares those rows with the administrator's data and investigates any missing April entry.

When two employees of the same ALE member are spouses and one enrolls the family, the instructions direct the coverage information to the form for the enrolling employee. The other employee can still require a Form 1095-C for offer reporting. Review this relationship before duplicating Part III enrollment on both statements.

Have the reviewer confirm the source version, covered-person count, monthly treatment and unresolved identifiers. If the administrator later changes an effective date, assess which released form fields change and whether a correction is required. Record both the agency correction and employee furnishing work rather than closing the issue when a new enrollment spreadsheet arrives.