What is the Employer Fine if
- Thread starter SamIam
- Start date
Answer: Employer Health Care Arrangements
Next time you have a question, just type in the question and search, wouldn't that be easier?
https://www.google.com/search?q=emp...=UTF-8&sourceid=ie7&rlz=1I7GGLL_en&gws_rd=ssl
FLM2 has the perfect answer.
SamIam, he hasn't been caught YET. No one has, because they haven't begun looking yet (and I presume he hasn't filed taxes yet either). IRS has 3-6 years to look back at a filing (depending on the type and amount of the "fraud") and another 10 years to collect it. He won't be off the hook for a while. Assuming he did this all year, it's over $100,000 in fines for 3 employees.
(No specific statute has been established for penalties, or the new tax filing forms (as far as I know), but Internal Revenue Manual - 25.6.1 Statute of Limitations Processes and Procedures has a list of everything else, and the range I gave is pretty typical.)
SamIam, he hasn't been caught YET. No one has, because they haven't begun looking yet (and I presume he hasn't filed taxes yet either). IRS has 3-6 years to look back at a filing (depending on the type and amount of the "fraud") and another 10 years to collect it. He won't be off the hook for a while. Assuming he did this all year, it's over $100,000 in fines for 3 employees.
(No specific statute has been established for penalties, or the new tax filing forms (as far as I know), but Internal Revenue Manual - 25.6.1 Statute of Limitations Processes and Procedures has a list of everything else, and the range I gave is pretty typical.)
$100 per day per employee for the IRS fine
Plus back taxes
Plus potential DOL fines
IRS Highlights Stiff Penalty for Reimbursing Individual Premiums
RayNY is right on that they haven't started looking for and fining employers yet. They will probably start with some relatively large-medium size companies to use as a poster-child to scare the others first.
Plus back taxes
Plus potential DOL fines
IRS Highlights Stiff Penalty for Reimbursing Individual Premiums
RayNY is right on that they haven't started looking for and fining employers yet. They will probably start with some relatively large-medium size companies to use as a poster-child to scare the others first.
- 8,448
I have an small employer client who, in September, gave raises to the employees instead of writing a company check, as they've done for the past 4 years.
There are only 4 (out of 6) employees covered by Individual ACA plans with this employer, but 2 of them are already late making the premium payment, according to the BC website.
There isn't much the employer can do to "encourage" them to pay. If they don't do it by a certain date, he can give them a $470 and $386 monthly pay cut. Essentially take back the raise.
Before this Summer, all employers had to do was sign a letter declaring that the premium being paid out of the company account for each employee was simply being deducted from the employee's pay.
Why did ObamaCare get involved in this arrangement between employer and employee? It has nothing to do with decreasing the number of uninsured in America! Vote em the hell out in 3 weeks.
There are only 4 (out of 6) employees covered by Individual ACA plans with this employer, but 2 of them are already late making the premium payment, according to the BC website.
There isn't much the employer can do to "encourage" them to pay. If they don't do it by a certain date, he can give them a $470 and $386 monthly pay cut. Essentially take back the raise.
Before this Summer, all employers had to do was sign a letter declaring that the premium being paid out of the company account for each employee was simply being deducted from the employee's pay.
Why did ObamaCare get involved in this arrangement between employer and employee? It has nothing to do with decreasing the number of uninsured in America! Vote em the hell out in 3 weeks.
Be careful with that one, it's my understanding that if the raise is conditional on being spent on health insurance, it's considered group coverage (contributed to by an employer), and is therefore subject to the penalty.
Taking away the raise because they are not paying premium with it would make it clear the money is for insurance and no other reason.
If the raise was awarded based on incurred premium, the same issue arises. I mention this because you gave two different raise figures that look like a premium amount. A percentage or flat dollar raise to a group or class is fine, specific raises to each employee based on their premium would also constitute a group plan.
They're using the "5000(b)(1)" definition for group health plan with respect to this penalty, 26 U.S. Code § 5000 - Certain group health plans | LII / Legal Information Institute if you'd like to check the definition for yourself.
- 508
That is UBER RISKY, better solution would be a defined contribution plan...
The way he did it is OK if and only if he says NOTHING about whether they spend the $ on anything other than whatever they want be it insurance, food, booze, etc. he cannot insinuate it is for insurance IOW...
- 8,448
2-23-2015
ObamaScare does it again. Has delayed enforcing the $100@day penalty until July of this year.
Ref: IRS delays tax penalties against small businesses that reimburse employees who buy individual health insurance policies - The Business Journals
I'm losing Life Ins, Disability, C.I. and Accident plans every month now that the employers have stopped directly paying the employees' premiums. I rushed them (the small employers) into giving raises, to avoid the government penalty...the penalty that's now delayed.
ObamaScare does it again. Has delayed enforcing the $100@day penalty until July of this year.
Ref: IRS delays tax penalties against small businesses that reimburse employees who buy individual health insurance policies - The Business Journals
I'm losing Life Ins, Disability, C.I. and Accident plans every month now that the employers have stopped directly paying the employees' premiums. I rushed them (the small employers) into giving raises, to avoid the government penalty...the penalty that's now delayed.
2-23-2015
ObamaScare does it again. Has delayed enforcing the $100@day penalty until July of this year.
Ref: IRS delays tax penalties against small businesses that reimburse employees who buy individual health insurance policies - The Business Journals
I'm losing Life Ins, Disability, C.I. and Accident plans every month now that the employers have stopped directly paying the employees' premiums. I rushed them (the small employers) into giving raises, to avoid the government penalty...the penalty that's now delayed.
This is only for HRAs.
Ann,
The HRA is what was mentioned in that IRS 2013-54 notice that put a scare in all of the employers who dropped coverage, let employees get individual coverage, and then reimbursed them one way or another for that individual coverage. $36,500 of penalty per employee per year is pretty severe.
Also appears to only be for small groups. I'd presume large groups are still going to be penalized.
The HRA is what was mentioned in that IRS 2013-54 notice that put a scare in all of the employers who dropped coverage, let employees get individual coverage, and then reimbursed them one way or another for that individual coverage. $36,500 of penalty per employee per year is pretty severe.
Also appears to only be for small groups. I'd presume large groups are still going to be penalized.
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