Affordability Safe Harbors

Determining the affordability of the health coverage offered to your full-time employees and their dependents can be a bit complex. To put it simply, provided coverage is considered affordable if the premium constitutes less than 9.5% (adjusted annually) of the household income of an eligible employee for the plan year.

Since household income can be difficult to determine, due to factors such as spousal or secondary income, the IRS offers three safe harbor options to assist in determining affordability: Continue reading Affordability Safe Harbors

Affordability Safe Harbors – Tax Year 2020

Determining the affordability of the health coverage offered to your full-time employees and their dependents can be a bit complex. To put it simply, provided coverage is considered affordable if the premium constitutes less than 9.78% of the household income of an eligible employee for plans starting in 2020.

The ACA originally set the affordability threshold at 9.5% of an employee’s household income, and the IRS has adjusted it annually.

Since household income can be difficult to determine, due to factors such as spousal or secondary income, the IRS offers three safe harbor options to assist in determining affordability: Continue reading Affordability Safe Harbors – Tax Year 2020

What is Employer Shared Responsibility?

Employer Shared Responsibility

The Affordable Care Act’s employer shared responsibility provisions require certain employers (called applicable large employers or ALEs) to offer affordable health coverage to at least 95% of their full-time employees and their dependents, or otherwise make an employer shared responsibility payment to the IRS. Continue reading What is Employer Shared Responsibility?