The Affordable Care Act

Transcription

1 The Affordable Care Act For Construction Employers By: Jack Widman, Esq. Mark Levengood, Esq. Jennifer Abrams, Esq. 1

2 Overview Employer Mandate Shared Responsibility Information Return W-2 Reporting FLSA Notices 2

3 Enforcement Transition Relief 2014 Suspended 2015 Suspended for Applicable Large Employers with 99 or fewer full-time employees on average 2016 Fully effective 3

4 Employer Mandate Generally Applicable Large Employers Must offer Affordable and Minimum Value coverage To Full-Time Employees and their dependents Or face Penalties Penalties are triggered by tax credits in the exchanges 4

5 Who is a Large Employer? Prior calendar year average 2015: 99 or more full-time employees (including fulltime equivalents) 2016: 50 or more 2 groups to track Employees averaging 30 hours weekly in a month All other employees hours divided by 120 Full Time Equivalents Track all hours Exempt and non-exempt CBA and non-cba 5

6 How do you calculate Large Employer Status? 12 monthly snapshots 2015 Relief - 6 monthly snapshots from 2014 Consecutive Controlled Group rules apply Seasonal worker exception (4 months) 6

7 What is Affordable, Minimum Value coverage? To avoid penalties, the coverage offered to fulltime employees must be affordable and minimum value Affordable 9.5% of household income (safe harbors: W-2, rate of pay) Self-only coverage Minimum Value 60% of projected costs for a standardized population (selfinsured GHP) 7

8 Who is a full-time employee? CBA versus non-cba Multiemployer Safe Harbor (discussed later) 30 hours on average weekly in a month Current tax year New full-time employees Enroll by first day of fourth full calendar month following start date No penalties prior to that date 8

9 Dependents of full-time employees? Offer of coverage required No minimum level of coverage Transition relief for the 2015 plan year an employer will not be penalized for failing to offer coverage to dependents of full-time employees Provided employer is taking steps in 2014 and

10 Multiemployer Safe Harbor Safe Harbor Components Large Employer CBA or Participation Agreement (bargaining unit alumni, office staff) Contributions required Plan offers affordable, minimum value coverage Plan offers coverage subject to plan s eligibility conditions FT status in current month does not trigger a penalty Delinquency? No guidance 10

11 De Minimis Transition Relief Relief from No Coverage penalty Allows for a margin of error 2015 only No penalties if ALE: offers coverage to 70% of full-time employees 2016 and going forward 70% increased to 95% 11

12 Part-time or variable hour employees? Fluctuating hours Reacting to monthly averages is impractical Look back method is optional way to deal with problem of variable hour/seasonal employee 12

13 Look back Method Ongoing EEs standard measurement period 3 to 12 months stability period 6 to 12 months (equal to measurement period) administrative period Optional up to 90 days, between end of standard measurement period and stability period 13

14 Employer Mandate Penalties The No Coverage Penalty Opt out vs. mistake Penalty based on entire full-time population Originally triggered by a failure to offer to one fulltime employee Month by month 1/12 of $2,000 Modified by regulations 14

15 Employer Mandate Penalties The Bad Coverage Penalty Failure to offer MV/affordable coverage Penalty limited to affected employee Month by month 1/12 of $3,000 15

16 Assessment of Penalties IRS notice of assessment Post-calendar year Opportunity to defend Facts and circumstances Large Employer status De Minimis Relief Safe Harbors 16

17 Timeline Cheat Sheet Separate handout Year by year steps to follow leading up to

18 Shared Responsibility Information Return Applies only to ALEs Annual filing to IRS, Annual Statement to Employees Content includes: Name, EIN Certification that coverage offered to full-time employees and their dependents (by calendar month) Months coverage was available Lowest cost monthly self-only premium Employer s number of full-time employees for each month during the calendar year The name, address, and TIN of each full-time employee Months each full-time employee was covered 18

19 Shared Responsibility Information Return, cont. Multiemployer Plan permitted to report information for ALE with respect to participating employees Non-CBA employees? Certification for 2015 Transition Relief 19

20 W-2 REPORTING Optional for employers contributing to multiemployer plans Non CBA employees only for employers required to file 250 or more W-2s in the year 20

21 FLSA NOTICES Every employer (not only Large Employers) Not a plan requirement Every employee (eligible or ineligible) Content describe exchanges/marketplaces employer-provided coverage Minimum Value yes or no? tax consequences of choosing exchange coverage over employer coverage (pre-tax v. post-tax) Timing existing employees: 10/1/13 new employees: within 14 days of hire 21

22 FLSA Notices No Penalties Multiemployer Relief Issue MEPs calculate minimum value, not employers Plans may assume employers obligation Relief only helpful for ongoing participants as of 10/1/13 Plans likely incapable of timely notifying new employees within 14 days Lag in contribution reporting to plans typically a 45 day process Non CBA Employees 22

23 QUESTIONS? 23

24 Contact Susanin, Widman & Brennan, P.C Drummers Lane, Suite 202 Wayne, PA (610) Jack Widman, Esq., Mark Levengood, Esq., Jennifer Abrams, Esq., 24