Risk & Business Magazine Spectrum Insurance Fall 2019 | Page 29

"ACCORDING TO THE INFORMATION LETTER, THE EXECUTIVE ORDER DOES NOT CHANGE THE LAW. THE ACA’S PROVISIONS ARE STILL EFFECTIVE UNTIL CHANGED BY CONGRESS, AND TAXPAYERS ARE STILL REQUIRED TO FOLLOW THE LAW, INCLUDING PAYING ANY APPLICABLE PENALTIES THEY MAY OWE." (FTEs), during the preceding calendar year. An ALE may be subject to a penalty only if one or more full-time employees obtain an Exchange subsidy (either because the ALE does not offer health coverage or offers coverage that is unaffordable or does not provide minimum value). On January 20, 2017, President Trump signed an executive order intended “to minimize the unwarranted economic and regulatory burdens” of the ACA until the law can be repealed and eventually replaced. The executive order broadly directs the Department of Health and Human Services and other federal agencies to waive, delay, or grant exemptions from ACA requirements that may impose a financial burden. However, the executive order does not include specific guidance about any particular ACA requirement or provision and does not change any existing regulations. IRS INFORMATION LETTER The IRS Office of Chief Counsel issued information letter number 2019-0008 clarifying that the ACA’s employer shared responsibility penalties continue to apply. This information letter was issued in response to a request from Senator Susan Collins (R-Maine) on behalf of her constituents. In her request, Senator Collins questioned whether an employer shared responsibility penalty may be waived or reduced based on hardship or other factors, as well as whether the IRS will extend the transition relief for ALEs with fewer than 100 employees. In the information letter, the IRS clarified that the law doesn’t provide for a waiver of an employer shared responsibility penalty. In addition, while several forms of transition relief were available for 2015 and 2016, the information letter reiterates that no transition relief is available for 2017 and future years. According to the information letter, the executive order does not change the law. The ACA’s provisions are still effective until changed by Congress, and taxpayers are still required to follow the law, including paying any applicable penalties they may owe. HIGHLIGHTS • The IRS clarified that both the individual and employer mandates continue to apply. • President Trump’s executive order does not change the law. Taxpayers are still required to follow the ACA, including paying any applicable penalties. • Changes to ACA requirements must be made by Congress through the legislative process. Karen Hebert is an Employee Benefits Advisor for Spectrum Insurance Group. Karen specializes in developing group employee benefit programs for employers in Wisconsin. She can be reached at 715-723-8135 ext. 5051 or [email protected]. MORE INFORMATION For additional information on the ACA Executive Order and the current tax filing season, please visit www.irs.gov/tax- professionals/aca-information-center-for- tax-professionals. + 29