While we are getting our information in order for the 2016 tax year, we received some clarity on the previous year from the IRS. The IRS’s Commissioner John Koskinen has reported on information surrounding employer shared responsibility payments and individual premium tax credits (PTCs) for the 2015 tax year.
ALEs are required to offer minimum essential coverage to their full-time employees. If they don’t, there’s a shared responsibility payment to be made by such employers. Further, if an employer offers healthcare but it’s not deemed affordable by employees, that employee is eligible for a PTC for Marketplace-purchased insurance.
Koskinen reports that in 2015, 80% of those who paid taxes stated on their tax forms that they had qualified coverage for the year. In addition, almost 13 million of taxpayers received one or more exemptions. About 5.3 million of taxpayers received a PTC, averaging $3,620 per credit. Advance payments of the PTC were provided to about 2.4 million Americans who filed tax returns, with an average of $670 per credit.
As penalties for employers who do not offer affordable coverage reaches billions of dollars, it’s important to read these stats as they reflect a considerable number of insured. They also reflect a considerable number of those who do not find employer-sponsored healthcare affordable and rely on PTCs to make up the difference. Keep your radars up and be on the lookout for IRS notices, as your company could be responsible for making some payments this tax season.
