ACA UPDATE: Individual Mandate Penalty Changed

On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act into law. The law itself is focused on altering the tax code for businesses and individuals, but does include one alteration to the Affordable Care Act (ACA).

Part VIII of the bill includes a reduction in the Individual Mandate Penalty from $695 or 2.5 percent to $0. This change will be effective beginning January 1, 2019.

Takeaway:

The Tax Cuts and Jobs Act does effectively remove the penalty from the Individual Mandate of the Affordable Care Act beginning in 2019. It should noted that this does not change a large employer’s responsibility to provide their full-time employees with an affordable and valuable offer of health insurance coverage.

Organizations should seek guidance on most of the Tax Cuts and Jobs Act with their counsel and/or tax professionals. For those looking for further guidance on the ACA-related provision of the Tax Cuts and Jobs Act, please contact your M3 Account team.

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About the Author

Karen Breitnauer

Senior Compliance Attorney (J.D.)
Karen is licensed to practice law in Wisconsin and is a member of the State Bar of Wisconsin, Health Law Section. She serves as the senior legal staff resource on employee benefits compliance surrounding Health Care Reform, COBRA, HIPAA, FMLA, ERISA and more. Karen provides information and advice on compliance issues through client education and consultation.

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