Employee-only contribution can’t exceed 9.56% of household income
The IRS recently lowered the 2018 affordability threshold to 9.56% of household income for purposes of determining eligibility for a premium tax credit. The 2017 rate was 9.69% of household income. This percentage is also used to determine the affordability of employer-sponsored coverage. Failure to provide a full-time employee with affordable coverage can result in an employer shared responsibility penalty.
Additionally, the IRS lowered the percent of income to 8.05% to determine eligiblity for a 2018 exemption from the individual shared responsibility payment (down from 8.16% for 2017).
|
Year |
Affordability % |
Maximum Monthly Contribution* |
Prior Year Federal Poverty Level (FPL) |
|
2018 |
9.56% |
$96.08 |
$12,060 |
|
2017 |
9.69% |
$95.93 |
$11,880 |
|
2016 |
9.66% |
$94.75 |
$11,770 |
* Based on Federal Poverty Level (FPL) affordability safe harbor.
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