Proposed regulations - Liability of “applicable large employers” regarding employee health coverage 

December 28: The Treasury Department and IRS this afternoon released for publication in the Federal Register proposed regulations (REG-138006-12) concerning the rules under section 4980H with respect to the shared responsibility for employers regarding employee health coverage.

The IRS today also posted a list of questions and answers (Q&As) on the employer shared responsibility provisions under the Affordable Care Act.


Read the proposed regulations: REG-138006-12 [PDF 351 KB]


Section 4980H provides that an “applicable large employer” is subject to an assessable payment if either:


  • The employer fails to offer its full-time employees (and their dependents) the opportunity to enroll in “minimum essential coverage” under an eligible employer-sponsored plan, and any full-time employee is certified to the employer as having received an applicable premium tax credit or cost-sharing reduction—section 4980H(a)

Or


  • The employer offers its full-time employees (and their dependents) the opportunity to enroll in “minimum essential coverage” under an eligible employer-sponsored plan, and one or more full-time employees is certified to the employer as having received an applicable premium tax credit or cost-sharing reduction (in general, liability arises because the employer’s coverage is “unaffordable” or does not provide “minimum value”)—section 4980H(b).

Today’s proposed regulations include descriptions of earlier IRS notices concerning section 4980H, and are organized as follows:


  • Definitions
  • Rules for determining status as an applicable large employer and applicable large employer member
  • Rules for determining full-time employees
  • Rules for determining assessable payments under section 4980H(a)
  • Rules for determining whether an employer is subject to assessable payments under section 4980H(b)
  • Rules relating to the administration and assessment of assessable payments under section 4980H

The proposed regulations include a request for comments and a notice of a public hearing (scheduled for April 23, 2013). The proposed regulations will be published in the Federal Register on January 2, 2013.



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