February 10, 2014

IRS Issues Final Employer Shared

Responsibility Rules

Today, the IRS released final regulations implementing the Employer Shared Responsibility
provision under the Affordable Care Act (ACA) for 2015 (the employer penalty). This guidance is
lengthy and provides helpful clarification in many areas. While further time is needed to read and
review this guidance, the following are some key aspects of this rule:

The employer penalty will apply to employers with 100 or more full-time equivalent employees
starting in 2015. For employers with 50-99 full-time equivalent employees, there is a one-year
delay and the employer penalty provision will start in 2016.

Most of the transition relief offered under the proposed regulations is extended to 2015,
including some relief afforded to non-calendar year plans that may delay the application of a
penalty until the first day of the 2015 plan year.

For 2015 only, applicable large employers will avoid the penalty that applies for failing to offer
health insurance coverage if coverage is offered to at least 70% of full-time employees.
Beginning in 2016, coverage must be provided to at least 95% of full-time employees to avoid
this penalty.

The final rule provides clarification around certain occupations and whether these employees
are viewed as full-time, including specific rules on seasonal employees, volunteers, and adjunct
faculty.

We will be reviewing the regulations in detail and will provide a more comprehensive summary in
the near future.

For the final rule, visit https://s3.amazonaws.com/public-inspection.federalregister.gov/2014-
03082.pdf.

For the US Treasury Departments Fact Sheet, visit
http://www.washingtonpost.com/blogs/wonkblog/files/2014/02/Fact-Sheet-021014.pdf.



This summary is intended to convey general information and is not an exhaustive anal ysis. This information is subject to change as guidance
develops. USI does not provide legal or tax advice. For advice specific to your situation, please consult an attorney or other professional.
For the IRSs Q&A format guide to the regulations, visit
http://www.irs.gov/uac/Newsroom/Questions-and-Answers-on-Employer-Shared-Responsibility-
Provisions-Under-the-Affordable-Care-Act.




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Disclaimer: This document is designed to highlight various employee benefit matters of general interest to our readers. It is not intended to
interpret laws, regulations or to address specific client situations. It should not be construed as legal advice or opinion.

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*Note: All of this is subject to change based on government regulations.