Small-business owners got a bit of reprieve from the Treasury Department and the Internal Revenue Service Monday, as the employer responsibility provision of the Affordable Care Act saw yet another delay.
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Businesses with between 50 and 99 employees will not have to comply with the employer mandate portion of President Obama’s signature legislation until 2016. The law requires every business with at least 50 or more full-time workers to offer them approved coverage or face a penalty of $2,000 per worker per year for failing to comply. For companies with 100 or more full-timers, this mandate kicks in in 2015.
The government says it is delaying the move to “streamline” tax reporting requirements for businesses. The departments said in a release that the delay will impact only about 2% of employers nationally. In 2011, there were 7,876,979 small businesses that fell into this category, according to the Small Business Administration.
“While about 96% of employers are not subject to the employer responsibility provision, for those employers that are, we will continue to make the compliance process simpler and easier to navigate,” said Assistant Secretary for Tax Policy Mark J. Mazur in a release. “Today’s final regulations phase in the standards to ensure that larger employers either offer quality, affordable coverage or make an employer responsibility payment starting in 2015 to help offset the cost to taxpayers of coverage or subsidies to their employees.”
Senior Treasury officials told FOX Business’ Rich Edson that the phase-in for smaller companies came as they had gotten requests to give these businesses more time. The employer mandate has already been delayed one year, as it was supposed to kick in in 2014 with the individual mandate.
This will be the 12th delay or tweak to the ACA since the open enrollment period kicked off on Oct. 1.