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IRS begins free-rider penalty process – will you be in the hot seat?

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Alice Gilman

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in Centerpiece,Compensation and Benefits,Human Resources

In 2017, the IRS began cracking down on applicable large employers that didn’t offer affordable minimum value group health benefits to at least 70% of their full-time employees during 2015. It’s now turning its attention to calendar year 2016. Who’s in the hot seat: employers that didn’t offer at least 95% of their full-time employees affordable group coverage or that offered coverage that wasn’t affordable or didn’t provide minimal value, and one employee obtained individual insurance on the exchange and qualified for a premium tax credit.

Free-rider penalties. The IRS will determine your liability for a free-rider penalty by examining the indicator codes you entered on employees’ 2016 Forms 1095-C, the information you entered on Form 1094-C and maybe even employees’ tax returns. Employers liable for the penalty will receive Letter 226J, which will be accompanied by Form 14765. Your response, on Form 147...(register to read more)

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