What do the “Series 1” and “Series 2” codes on Form 1095-C represent, and how should they be used?

The “Series 1” and “Series 2” codes on Form 1095-C are used to indicate specific details about the health coverage offered to employees and the employer’s compliance with the Affordable Care Act (ACA). These codes are reported in Part II of the form and are critical for determining compliance with the employer mandate and the affordability of coverage.

Series 1 Codes (Line 14)

These codes describe the type of coverage offered to an employee and their dependents. Each code provides information about who was offered coverage and the extent of the offer. Common codes include:

1. 1A: Qualifying offer – Minimum essential coverage providing minimum value was offered to the employee, spouse, and dependents, and it was affordable based on the federal poverty line safe harbor.
2. 1B: Minimum essential coverage providing minimum value was offered to the employee only.
3. 1C: Minimum essential coverage providing minimum value was offered to the employee and their dependents (not the spouse).
4. 1E: Minimum essential coverage providing minimum value was offered to the employee, spouse, and dependents.
5. 1H: No offer of coverage or coverage that does not qualify as minimum essential coverage.

Employers must select the appropriate code for each employee based on the coverage offered during the reporting period.

Series 2 Codes (Line 16)

These codes indicate whether the employer qualifies for a safe harbor or another reason that they should not be subject to a penalty under the ACA’s employer shared responsibility provisions. Common codes include:

1. 2A: Employee was not employed on any day of the month.
2. 2B: Employee was not a full-time employee during the month.
3. 2C: Employee enrolled in the coverage offered.
4. 2D: Employee was in a limited non-assessment period (e.g., waiting period or initial measurement period).
5. 2F: Coverage was affordable under the Form W-2 safe harbor.
6. 2G: Coverage was affordable under the federal poverty line safe harbor.
7. 2H: Coverage was affordable under the rate of pay safe harbor.

How to Use These Codes

• Employers: Select the appropriate codes for each month of the year, reflecting the offer of coverage and affordability for each employee. For example, if an employee was offered qualifying, affordable coverage for the entire year and enrolled, you would use 1E (Line 14) and 2C (Line 16).
• Employees: Use the information on Form 1095-C to verify that they had health coverage meeting ACA requirements or to determine their eligibility for a premium tax credit.