On March 31, 2014, the Affordable Care Act will make health insurance mandatory for most Americans. Most employees will be required by law to have health coverage or pay a tax penalty that will continue to increase annually:
- In 2014, the penalty will be $95 per adult and $47.50 per child (up to $285 per family) or 1% of taxable household income, whichever is greater.
- In 2015, the penalty will be $325 per adult and $162.50 per child (up to $975 per family) or 2% of taxable household income, whichever is greater.
- In 2016, the penalty will be $695 per adult and $347.50 per child (up to $2,085 per family) or 2.5% of taxable household income, whichever is greater.
- After 2016, the penalty will continue to increase annually based on the increase to the cost of living.
As a small business owner, you may be wondering how this legislation affects you, or perhaps you are receiving questions from employees about their healthcare options under the new law. Regardless of how many full-time equivalent* employees you have or whether you plan to offer a group insurance plan, there are ways that you can help your employees maximize the benefits of the ACA.
Click to enlarge the infographic below and follow the decision tree inside to figure out the options that are available for your small business and your employees.
*The “full-time equivalent employees” count is the combination of full-time employees (any employee who works 30 hours or more per week in any month) plus the number of full-time equivalent employees represented by your part-time workforce (calculated by taking the hours worked by all part-time employees in a month and dividing that amount by 120). Seasonal employees who work less than 120 days in a calendar year are excluded from this equation. For more information on calculating your FTE, see this post from The Washington Post.
Infographic by Column Five