Small employers (non Applicable Large Employers) that reimburse employees for the cost of individual health coverage – should adjust any applicable employer payment plans not in compliance with ACA by June 30, 2015
Insight on the Affordable Care Act
The IRS has provided transition relief and guidance for employers that reimburse employees for the cost of individual health coverage. Employer group health plans must abide by a number of rules, including the market reform rules adopted by the Affordable Care Act. Many small employers were shocked to learn last year that employee payment plans, under which they reimbursed their employees for the cost of obtaining individual health insurance, violated certain Affordable Care Act rules, and that they risked a $100 per day per affected employee excise tax if they continued using such an arrangement starting in 2014. This latest guidance offers transition relief, and clears up some confusion arising from previous IRS guidance.
Transition relief for 2014 and half of 2015
The excise tax will not be asserted for any failure to satisfy the market reforms by employer payment plans that pay, or reimburse, employees for individual health policy premiums or Medicare Part B or Part D premiums for 2014 for employers that are not Applicable Large Employers (ALEs) for 2014. Relief also extends from January 1 through June 30, 2015, for employers that are not ALEs for 2015. After June 30, 2015, such employers may be liable for the excise tax. ALE status is determined under the employer mandate rules.
-via CCH ClientRelateTM
Free webinar on the Affordable Care Act
Complimentary Web Seminar
July 21, 2015
2 pm ET/11 am PT
Join top tax expert Mark Luscombe, JD, LLM, CPA as he discusses the Affordable Care Act (ACA) — the most recent decisions, developments, requirements and how it may impact your business.
· Implications of the Supreme Court decision in King v. Burwell on the Affordable Care Act
· Preparing for the employer mandate starting in 2015/2016
· Preparing for employer reporting starting in 2015
· Reimbursement of employees for health insurance expenses
· Anticipating the excise tax on “Cadillac” health plans starting in 2018
· Legislative activity related to the Affordable Care Act in 2015
Get Guidance now on ACA:
· CCH Learning Course: Employer Mandate of the Affordable Care Act
· CCH Learning Course: Health Care Reform and Closely Held Businesses
· CCH Seminar Affordable Care Act: Understanding the Employer Mandate
· CCH Seminars Recordings Affordable Care Act