Business owners who gambled in 2015 that not providing their employees with group health insurance would be cheaper than the Affordable Care Act penalties are now waking up to ACA penalties that in some cases could be as high as $36,500 per employee!

For business owners, IRS penalties could mean everything from bank account levies, to personal tax liens to the IRS denying or revoking their passports (under a new law that went into effect December 4th). WIth just one letter from the IRS, you will fall from respected business owner to outlaw.

The IRS is unlike any creditor you’ve seen. Until the IRS gets the money, the interest and penalties grow and the IRS bleeds more red on your bottom line. They have a massive arsenal of collection mechanisms to seize your assets. Like the Terminator, they won’t stop until they’ve completed their mission.

What are some of the biggest ACA penalties for businesses you can face?

According to the SBA, Employer health care arrangements, also known as employer payment plans, generally include those arrangements where the employer does not establish a health insurance plan for its own employees, but reimburses those employees for premiums they pay for health insurance (either through a qualified health plan in the Marketplace or outside the Marketplace).  Under IRS Notice 2013-54, such arrangements do not satisfy the market reforms under the Affordable Care Act and may be subject to $100/day excise tax per applicable employee (which is $36,500 per year, per employee) under section 4980D of the Internal Revenue Code.

If you don’t have an employer payment plan, you could still face these penalties:

How Much Are The ACA Penalties?

If an employer doesn’t offer full time employees insurance, and if at least one full timer receives federal insurance subsidies in the individual exchange, the business will pay $2,160 per FT (minus the first 30). Example: a business with 50 FTs, two of whom are subsidized, would pay $43,000 = $2,160 x (50 – 30).

What if you provide coverage that is deemed unaffordable or inadequate?

If an employer offers insurance that is not affordable and at least one FT receives insurance subsidies, it pays the lesser of $3,240 per subsidized FT OR $2,160 per FT (minus the first 30). So an offering large employer with two subsidized FTs would be fined $6,840. For a 50-employee employer with 14 or more subsidized FTs (above the tipping point for an employer of this size), the penalty would be $45,360.

Brokers, Health Carriers & Payroll Companies Are Leaving Your Business Wide Open To ACA Penalties

In 2016, Payday HCM has seen a HUGE influx of businesses who are only just now realizing how vulnerable they are to Affordable Care Act penalties due to the actions (or inactions) of their broker, payroll companies or health carriers.  Business are making the switch to Payday HCM because they say that their broker, health carriers and former payroll companies, simply aren’t giving these businesses the level of personalized service they need.  The payroll companies and the health carriers are each blaming the other for their lack of ACA record keeping.

How can Payday HCM make the ACA process easier and better for you in 2016?

Payday HCM can guide you through:

  • ACA penalties
  • Explain the Rule of Parity
  • Detail what minimum essential coverage plan and minimum value plan means for your business.

When you bundle your business services with Payday HCM we can shop the nation’s best  health carriers to find you a plan your business can afford so that you’ll never have to face the ACA penalty tex terror again.

Payday HCM has your ACA experts who can help you figure out if you need to be offering health benefits to these employees. We have 30+ years of experience to help you find, screen, pay, and keep the best employees.

If you have any questions, call us at 888-2PAYDAY FREE or contact us via

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