Tip Tuesday! Obamacare: IRS gives small firms break from costly penalty

By Jared Bilski

The feds are still warning firms that offering employees stand-alone health reimbursements (HRAs) to purchase coverage on their own won’t satisfy the health reform law’s employer mandate.
But the feds are giving small firms a little bit longer before they will get penalized for such a move.

Relief until July 1

In Notice 2015-17, the IRS and Treasury department announced that this “transitional relief” from enforcement for standalone HRAs will be extended until July 1, 2015.
After this date, employers with these arrangements could once again face stiff penalties.
The recent notice from the feds also addressed certain other arrangements. Specifically, the guidance offers relief if the payment arrangement is:

• sponsored by an employer with 50 or fewer employees that is not an “applicable large employer” subject to the employer mandate (e.g., a stand-alone HRA)
• a healthcare arrangement sponsored by an S-corporation for 2% shareholder employees
• a Medicare premium reimbursement arrangement, or
• a TRICARE-related health reimbursement arrangement.

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