In recognition of the five-year anniversary of healthcare reform, here are five things you should know about some of the key ACA requirements for businesses in 2015:
The shared responsibility provision of healthcare reform is effective either this year or next year, depending on how many employees you have. The employer mandate or “play or pay,” provision requires companies with at least 50 full-time equivalent employees to offer minimum essential healthcare coverage to their full-time employees and their dependents. Applicable large employers (ALEs) can choose to pay a substantial penalty if they don’t abide by the law.
Companies with 100 or more full-time employees (or full-time equivalents) must begin complying with the shared responsibility provision this year and companies with between 50 and 99 full-time employees or equivalents must begin complying with the shared responsibility provision next year.
Depending on the size of your business, you might not be subject to the shared responsibility provision at all. Good news, companies with fewer than 50 full-time employees or equivalents are not subject to the shared responsibility this year or next year.
To be compliant with ACE, health coverage offered by businesses must meet certain criteria. It must provide minimum value and must be affordable. Healthcare is “affordable” if employees’ share of their premiums does not exceed 9.56 percent of their annual household income in 2015 and it is of “minimum value” if the policy covers at least 60 percent of the cost of healthcare services.
Tax credits may be available for your business. Small businesses with up to 25 full-time equivalent employees could receive a tax credit of up to 50 percent toward their contributions to employees’ healthcare premiums. Ask your enrolled agent to see if you qualify for this credit.
If you are an applicable large employer (ALE) you have reports to file. You must report to the IRS information about the health care coverage, if any, you offered to full-time employees, and must also furnish to employees a statement that includes the same information provided to the IRS. Contact your enrolled agent for more information
Be sure to contact us with any questions about your company’s specific responsibilities under the ACA this year.