Employer “Mandate” Under the Affordable Care Act Delayed Until 2015

The U.S. Treasury Department announced on July 2, 2013 that the employer shared-responsibility payments (commonly referred to as the “employer mandate” or the “employer penalties”) under the Patient Protection and Affordable Care Act (the “ACA”) have been delayed until 2015. The Treasury Department also delayed mandatory employer and insurer reporting requirements until 2015.

The implementation of the employer penalties for failure to offer health coverage or to provide affordable health coverage to full-time employees was scheduled to go into effect on January 1, 2014. The delay of the employer penalties until 2015 will come as welcome relief to many employers and will provide additional time for the Treasury Department o finalize the regulations regarding the shared-responsibility payments.

In addition, the Treasury Department delayed employer reporting requirements under the Internal Revenue Code to provide additional time to simplify the reporting requirements and to ensure a smooth transition.

The Treasury Department clarified that the changes to the employer penalty and employer reporting requirements are not intended to impact employees’ access to premium tax credits which will be available beginning in 2014. The Treasury Department has indicated that it will issue formal guidance further describing the implementation of these changes and the new effective dates in the very near future.

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Tax

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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