February 24, 2015
Authored by: Lisa Van Fleet
Employer payment plans, which include arrangements where an employer pays, or reimburses an employee, for some or all of the premium expenses incurred for an individual health insurance policy, violate market reforms under the Affordable Care Act (“ACA”).
Notice 2015-17 is the latest in a series of IRS guidance on these arrangements (see our earlier post on this topic here). While it reiterates previous conclusions regarding the failure of the arrangements to satisfy the ACA, it also provides excise-tax transition relief for certain small employers.
Limited Transitional Relief for Non-ALEs
Noncompliant group health plans may be liable for a $100/day excise tax for failure to satisfy ACA market reforms. The new Notice, while reiterating that conclusion, provides that the tax will not be asserted under two conditions: