Affordable Care Act: What Employers with Fewer than 50 Employees Need to Know


Notice: Historical Content

This is an archival or historical document and may not reflect current law, policies or procedures.

IRS Health Care Tax Tip 2017-02, January 11, 2017

As an employer, the number of employees you have during the last calendar year determines which parts of the health care law apply to your organization. If you are an employer with fewer than 50 full-time employees, including full-time equivalent employees, here are three things to know about how the health care law affects you.

Information Reporting

  • If you offer employer-sponsored self-insured health coverage to your employees, you will use Form 1095-B, Health Coverage Information Return to report information to covered individuals about each person enrolled in coverage. The deadline for filing this form with the IRS is February 28, 2017, or March 31, 2017 if filing electronically. The deadline for furnishing this form to the covered individual is March 2, 2017, which is a 30-day extension from the original due date of January 31.

Tax Credit

  • You may be eligible for the small business health care tax credit if you meet all of the following conditions. You:
    • cover at least 50 percent of employees’ premium costs
    • have fewer than 25 full-time equivalent employees
    • pay average annual wages per full-time equivalent employee of less than $52,000 in tax year 2016
    • purchase coverage through the SHOP Marketplace

Shared Responsibility Payment

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