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Under the American Recovery and Reinvestment Act of • Attestation of involuntary termination, including the
2009 (ARRA), employers are allowed a credit against date of the involuntary termination for each covered
“payroll taxes” (referred to in this publication as “employ- employee whose involuntary termination is the basis
ment taxes”) for providing COBRA premium assistance to for eligibility for the subsidy.
assistance-eligible individuals. For periods of COBRA • Proof of each assistance-eligible individual's eligibility
continuation coverage beginning after February 16, 2009, for COBRA coverage and the election of COBRA cov-
a group health plan must treat an assistance-eligible indi- erage.
vidual as having paid the required COBRA continuation
coverage premium if the individual elects COBRA cover- • A record of the SSNs of all covered employees, the
age and pays 35% of the amount of the premium. amount of the subsidy reimbursed with respect to
An assistance-eligible individual is a qualified benefi- each covered employee, and whether the subsidy
ciary of an employer's group health plan who is eligible for was for one individual or two or more individuals.
COBRA continuation coverage during the period begin-
ning September 1, 2008, and ending May 31, 2010, due
to the involuntary termination from employment of a cov- 1. Employer Identification
ered employee during the period and elects continuation
COBRA coverage. The assistance for the coverage can Number (EIN)
last up to 15 months.
The COBRA premium assistance credit was available If you’re required to report employment taxes or give tax
to an employer for premiums paid on behalf of employees statements to employees or annuitants, you need an EIN.
who were involuntarily terminated from employment be-
tween September 1, 2008, and May 31, 2010. The CO- The EIN is a nine-digit number the IRS issues. The dig-
BRA premium assistance credit isn’t available for individu- its are arranged as follows: 00-0000000. It is used to iden-
als who were involuntarily terminated after May 31, 2010. tify the tax accounts of employers and certain others who
Therefore, only in rare circumstances will the credit still be have no employees. Use your EIN on all of the items you
available, such as instances where COBRA eligibility was send to the IRS and the SSA. For more information, see
delayed as a result of employer-provided health insurance Pub. 1635.
coverage following termination. For more information If you don’t have an EIN, you may apply for one online
about the credit, see Notice 2009-27, 2009-16 I.R.B. 838, by visiting the IRS website at IRS.gov/EIN. You may also
available at IRS.gov/irb/2009-16_IRB#NOT-2009-27. apply for an EIN by faxing or mailing Form SS-4 to the
Administrators of the group health plans (or other enti- IRS. If the principal business was created or organized
ties) that provide or administer COBRA continuation cov- outside of the United States or U.S. territories, you may
erage must provide notice to assistance-eligible individu- also apply for an EIN by calling 267-941-1099 (toll call).
als of the COBRA premium assistance. Don't use an SSN in place of an EIN.
The 65% of the premium not paid by the assistance-eli-
gible individuals is reimbursed to the employer maintain- You should have only one EIN. If you have more than
ing the group health plan. The reimbursement is made one and aren't sure which one to use, call 800-829-4933
through a credit against the employer's employment tax li- or 800-829-4059 (TDD/TTY for persons who are deaf,
abilities. For information on how to claim the credit, see hard of hearing, or have a speech disability). Give the
the Instructions for Form 941-X or the Instructions for numbers you have, the name and address to which each
Form 944-X. The credit is treated as a deposit made on was assigned, and the address of your main place of busi-
the first day of the return period (quarter or year). In the ness. The IRS will tell you which number to use. For more
case of a multiemployer plan, the credit is claimed by the information, see Pub. 1635.
plan, rather than the employer. In the case of an insured If you took over another employer's business (see Suc-
plan subject to state law continuation coverage require- cessor employer in section 9), don't use that employer's
ments, the credit is claimed by the insurance company, EIN. If you’ve applied for an EIN but don't have your EIN
rather than the employer. by the time a return is due, file a paper return and write
Anyone claiming the credit for COBRA premium assis- “Applied For” and the date you applied for it in the space
tance payments must maintain the following information to shown for the number.
support their claim.
• Information on the receipt of the assistance-eligible in-
dividuals' 35% share of the premium, including dates 2. Who Are Employees?
and amounts.
• In the case of an insurance plan, a copy of an invoice Generally, employees are defined either under common
or other supporting statement from the insurance car- law or under statutes for certain situations. See Pub. 15-A
rier and proof of timely payment of the full premium to for details on statutory employees and nonemployees.
the insurance carrier required under COBRA. Employee status under common law. Generally, a

• In the case of a self-insured plan, proof of the pre- worker who performs services for you is your employee if
mium amount and proof of the coverage provided to you have the right to control what will be done and how it
the assistance-eligible individuals. will be done. This is so even when you give the employee

Publication 15 (2020) Page 11