Nearly 10,000 small businesses could be subject to hefty fines as the IRS continues to enforce the employer mandate in the Affordable Care Act (ACA), according to the chairman of the House Committee on Small Business.
U.S. Rep. Steve Chabot (R-OH) said the enforcement actions would be from the 2015 fiscal year alone and would catch many small employers by surprise with fines of $2,080 to $3,390 per employee.
The ACA has employer shared responsibility provisions that penalize companies with 50 or more employees that do not offer health insurance to their workers. While the law has been in effect since 2014, enforcement actions were only started in December 2017.
“While the IRS, like other federal agencies, is obligated to enforce the laws under its jurisdiction, small businesses who already compete with large companies now have the IRS knocking on their doors to collect on a flawed law the previous Administration put in place but failed to enforce for years,” Chabot wrote in a letter to the agency.
He also noted that the definition of a large employer in the ACA (51 employees) is much different than elsewhere in the federal government, where businesses with 500 or fewer employees are considered small.