On Feb. 10, the Obama administration delayed the employer healthcare mandate once again until 2016. The one year delay gives mid-sized employers (50-99 full-time employees) an additional year to adapt to the healthcare regulations without incurring a penalty.

The coverage requirement for mid-sized employers, which was supposed to take effect as of Jan. 1, 2015 was delayed until Jan. 1, 2016.  Although they will not have to offer health coverage until Jan. 1, 2016, they will still need to report on their workers and coverage in 2015.

The new regulations also provide a “phase-in” rule for larger employers with 100 or more employees.  Large employers will not be penalized as long as they offer coverage to at least 70 percent of its full-time employees in 2015, and 95 percent in 2016 and beyond.

In addition, the final regulations provided clarification on the treatment of certain workers:

  • Volunteers for a government or tax-exempt entity (e.g., volunteer firefighters) will not be considered employees
  • Seasonal employees who normally work less than 6 months will not be considered employees
  • Adjunct faculty members will be counted as working 2.25 hours per week for each hour of teaching or classroom time
  • Students in federal or state sponsored work-study programs will not be considered employees
  • Teachers and others in the education-related field will not be considered part-time employees even if they have reduced workloads in the summer months

For questions on how the final regulations might impact you, please contact us.

About the Authors

Cindy H. Mitchell

CPA
Senior Manager, Taxation Services

Robert M. Burak

CPA
Partner, Taxation Services

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