2017 'Pay or Play' Penalty and Affordability Amounts Announced

2017 'Pay or Play' Penalty and Affordability Amounts Announced

2017 'Pay or Play' Penalty and Affordability Amounts Announced

The IRS has updated its existing Q&As on the Affordable Care Act's employer shared responsibility ("pay or play") requirements to reflect adjustments to the pay or play penalty and affordability amounts. Those adjustments are as follows:

  • For calendar year 2017, the applicable per-employee dollar penalties of $2,000 and $3,000 are adjusted to$2,260 and $3,390, respectively.
  • For plan years beginning in 2017, the affordability threshold for purposes of both the pay or play affordability safe harbors and the premium tax credit provisions is 9.69%.
The Q&As also address what counts as an "offer of coverage" for purposes of pay or play compliance.Click here to view the Q&As in their entirety.

Check out our Pay or Play section for step-by-step guidance, worksheets, and calculators that can help employers understand whether they will be subject to a penalty, and how to calculate it.