You’re safe. For now. From this particular piece of legislation.
2017 is rapidly coming to a close, but that doesn’t mean there isn’t more legislative news pertaining to the Affordable Care Act and your taxes and potential penalties. However, there is some good news. The Senate passed legislation on Wednesday, December 7th, eliminating a tax penalty on employers who reimburse employees for the cost of health insurance premiums, following passage of the measure last week in the House.
The IRS began enforcing the penalty on employers last year, even though it isn’t part of the Affordable Care Act. Employers who violate the rule can be fined up to $100 per day for each employee, or up to $36,500 a year, which is 18 times more than the penalty imposed on larger employers that don’t offer insurance to workers.
Under Section 18001 of the 21st Century Cures Act, business owners would be permitted to compensate employees for the cost of individual insurance premiums or medical visits. President Obama has issued a statement in support of the legislation.
Both the Senate and the House have now passed critical legislation to protect small business owners from outrageous IRS fines. A significant number of businesses reimbursed employees for the cost of health insurance, a practice the IRS tried to stamp out despite the lack of clear direction from Congress. Now, Congress has acted to make it clear that businesses should not be punished just for trying to help their employees pay for health care costs.
The legislation includes a number of other sweeping health care provisions, including more funding for research into diseases, improvements in the mental health treatment system, and an overhaul of the regulatory system for medical devices and pharmaceuticals. It also includes funding to fight opioid drug abuse, collect genetic information from a million volunteers for medical research purposes and provide money to back Vice President Joe Biden’s “moonshot” effort to find a cure for cancer.
“One of the last times I’ll preside over an actual Senate vote count,” Biden tweeted Monday. “A lot of lives will be saved by this bill, God willing.”
The bill also provides more authority for the National Institutes of Health to fund innovative medical research, allowing it to set up “Eureka prize” competitions to find effective treatments.
As always, the NARFA team works hard to keep you in the loop regarding legislative news impacting your business. NARFA offers leading employee benefit programs for industries in the automotive, roads, fuel, and related industries. Since 1929, our “power in numbers” has provided unparalleled service, programs, and a voice in legislative issues for our members.
Please contact us today to learn more about our programs, and why we retain 99% of our members every year!