Heads up: ‘Cadillac Tax’ could cost you more than 40%

by Christian Schappel

The IRS just issued its second set of guidance on the ACA’s “Cadillac Tax,” and it’s sure to get mixed reviews from employers offering decent health benefits. 

As you know, the ACA’s so-called “Cadillac Tax” will impose a 40% non-deductible excise tax on the value of health insurance plans exceeding $10,200 for individuals and $27,500 for family coverage.

The IRS’ latest guidance — Notice 2015-52 — is a follow-up to guidance it issued this past winter addressing future rules governing the calculation and payment of the excise tax.

Both sets of guidance is meant to give plan sponsors and insurers an idea of how the “Cadillac Tax” is to be enforced and administered — but they don’t set forth any concrete rules that must be followed. That comes later via the proposed/final rulemaking process.

For now, the IRS is simply asking employers to review and comment on this guidance to help it shape the final rules.

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