Q: With Trump’s new tax law in effect, do I still have to comply with Obamacare’s employer mandate?
A: Dear Inquiry:
While Trump’s Tax Cuts and Jobs Act (TCJA) did repeal the Affordable Care Act’s (ACA) individual mandate, the new law did NOT change the employer mandate.
So if you were previously required to provide health insurance to your employees under the ACA, that mandate is still in full effect—and the IRS plans to enforce it.
The TCJA, which went into effect in January 2019, repealed the ACA’s individual mandate requiring all Americans to have health insurance or pay a penalty. Because this move is likely to seriously impede the ACA in the long run, the Trump administration has touted that the entire ACA is essentially repealed.
But this is simply not true. In fact, the new tax law had no effect whatsoever on the ACA’s employer mandate.
This means that if you employ 50 or more full-time employees, you must offer ACA-compliant health insurance to those employees or face stiff penalties from the IRS. If you employ fewer than 50 full-time employees, you are NOT subject to the mandate and not required to offer health insurance.
That said, if you have fewer than 25 full-time employees and do offer health insurance to your team, you might qualify for the Small Business Health Care Tax Credit equal to 50% of your premiums.
Contact a Family Business Lawyer® if you’d like to learn more or need help navigating the ACA’s tax requirements.