In May, the ACA Times released an article detailing what exactly a notice from the Health Insurance Marketplace entails. As previously stated, this notice is to inform employers that one or more employees from their company obtained a Premium Tax Credit (PTC) providing them assistance in paying for coverage purchased from the ACA’s Health Insurance Marketplace.
Is the notice scary? It could be, especially when it can lead to an employer shared responsibility payment (read: penalty) if the employee received a PTC due to an employer not providing minimum essential coverage or an affordable and/or minimum value plan. However, these notices can be just that: a notice.
Action is required if you are an Applicable Large Employer (ALE), meaning your company has 50 or more full-time and full-time equivalent employees. So if your company is below 50 (49 and below), then you qualify as a small business and can just disregard the notice. As an ALE, you can appeal in situations such as discrepancy in defining said employee as “full-time” or their PTC eligibility.
You can appeal to the HHS, but understand this: the Department of Health and Human Services (HHS) does NOT issue the potential penalties. That is the role of the IRS; the HHS simply reports these notices to the IRS. If your appeal to the HHS proves victorious, the IRS will not be notified about a possible penalty. While the notice is step one for some in a process that oftentimes leads to penalties, that is not always the case.
Should you have any further questions, be sure to contact the IRS.