Affordable Care Act Impact On Individuals, Businesses
By: Mark Gruba
Updated: January 21, 2013
Changes are on the way for individuals and business owners as a result of the 2010 Affordable Care Act.
David Young of Young and Company CPAs discussed how the health care act will impact employers and employees Monday morning on News 8 at Sunrise.
The Affordable Care Act was passed in March of 2010 to expand affordable coverage, change insurance rules, overhaul the health care system and create exchanges in each state for individuals and small group markets to purchase health insurance.
Young said generally people will be required to have health insurance by 2014. If you don't have health insurance at that point there will be a tax penalty based upon household income. The penalty is phased in from $95 in the first year to $695 per calendar year, or up to 2.5 percent of income in 2016 and beyond. There will be subsidies to assist those who cannot afford to purchase health insurance.
Larger employers, those with 50 or more full time employees, will be require to "pay or play" beginning in 2014. They can choose to pay for employee health insurance or pay a fine. Qualifying smaller employers, no more than 25 employees, are eligible for a tax credit for offering coverage beginning in 2010. That tax credit increases in 2014 if employers buy from the exchange, and then phases out in 2016.
Employer coverage meets the minimum value test if it covers at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan. The employee would cover the remaining 40 percent, provided that amount doesn't exceed 9.5 percent of his or her household income for self-only coverage.
For more information, click here.
David Young of Young and Company CPAs discussed how the health care act will impact employers and employees Monday morning on News 8 at Sunrise.
The Affordable Care Act was passed in March of 2010 to expand affordable coverage, change insurance rules, overhaul the health care system and create exchanges in each state for individuals and small group markets to purchase health insurance.
Young said generally people will be required to have health insurance by 2014. If you don't have health insurance at that point there will be a tax penalty based upon household income. The penalty is phased in from $95 in the first year to $695 per calendar year, or up to 2.5 percent of income in 2016 and beyond. There will be subsidies to assist those who cannot afford to purchase health insurance.
Larger employers, those with 50 or more full time employees, will be require to "pay or play" beginning in 2014. They can choose to pay for employee health insurance or pay a fine. Qualifying smaller employers, no more than 25 employees, are eligible for a tax credit for offering coverage beginning in 2010. That tax credit increases in 2014 if employers buy from the exchange, and then phases out in 2016.
Employer coverage meets the minimum value test if it covers at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan. The employee would cover the remaining 40 percent, provided that amount doesn't exceed 9.5 percent of his or her household income for self-only coverage.
For more information, click here.
