Employer Mandate Calculator
Many people have heard of the employer mandate. Under Health Care reform, employers with more than 50 full time employees to offer health insurance to their employees.
IF they don’t they will have to pay a penalty that is not tax deductible.
They may also have to pay a penalty if any of their employee get subsidies through the health insurance exchange.
This calculator will help you determine if you fall under the employer mandate.
1. Count the employees who worked at least 30 hours per week each month (including seasonal employees) in the prior calendar year.
2. Count the employees considered full-time by adding the number of hours worked by all part-time employees (as well as seasonal) and dividing by 120.
3. Add the monthly totals of steps 1 and 2 and divide by 12.
What are the penalties?
There are different kinds of penalties, based on what part of the rule the employer didn’t follow.
Employers have to pay a penalty for:
1. Not offering health coverage to full-time employees and their dependent children to age 26, and if any full-time employee gets government aid to lower the cost of coverage. The annual penalty is $2,000 x the number of full-time employees, minus the first 30 employees.
2. Offering health coverage for only part of the year. The penalty is based on the number of full-time employees and the number of months coverage was not offered.
3. Offering health coverage to 95% of full-time employees but one or more full-time employees gets government aid to lower the cost of their coverage because the coverage is not considered affordable. The annual penalty is $3,000 per employee getting government aid.