3640.02 / What issues should employers that choose to allow remote work arrangements consider with respect to employer-sponsored health insurance coverage and reporting?
However, many states have also implemented their own ACA-like laws that govern health coverage requirements within the state (i.e., New Jersey, the District of Columbia, Massachusetts, Rhode Island and California have their own health coverage laws in place). Because of that, it is also possible that employers could be subject to penalties for failure to provide affordable coverage at the state level. Those employers will also be subject to state-level reporting requirements if they permit an employee to work remotely from a state that has health coverage laws in effect.
Some state laws mirror the federal ACA reporting requirements. However, Massachusetts has developed its own Forms 1099-HC1 that differ from the federal Forms 1095-C. Employers who permit employees to work remotely from Massachusetts must send Forms 1099-HC to employees within the state. Employers who fail to send the forms can be subject to a penalty of up to $50 per individual (up to a cap of $50,000).2 The forms must be submitted electronically.3
The existing state-level reporting requirements for employers are detailed and vary from state to state. Employers who permit employees to work remotely in states other than where the employer is physically located will be required to comply with a variety of state-level laws or risk becoming subject to penalties for noncompliance.
1. https://www.mass.gov/service-details/1095-b-and-1099-hc-tax-form