This new legislation eliminates a huge burden on small business owners.
Small business owners can breathe a sigh of relief.
Pres. Barack Obama has signed bi-partisan legislation that will prevent the IRS from issuing fines on small businesses that reimburse or directly pay their employees for healthcare costs.
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“Both the Senate and the House have now passed critical legislation to protect small business owners from outrageous IRS fines,” said NFIB President and CEO Juanita Duggan. NFIB was a major advocate for this bill, fighting for small business owners at local and national levels. “Our research showed that a significant percentage of NFIB members reimbursed employees for the cost of health insurance, a practice the IRS tried to stamp out despite the lack of clear direction from Congress. Now Congress has acted to make it clear that businesses should not be punished just for trying to help their employees pay for healthcare costs.”
In part because of NFIB’s efforts, small business owners will now be allowed to compensate employees for the cost of individual insurance premiums or medical visits.
Prior to this new provision, owners who violated the rule had to pay a fine of $100 per day, per worker. That could amount to $36,500 a year, which is 18 times larger than the penalty imposed on larger employers that don’t offer insurance to their workers, according to NFIB. The IRS began enforcing the penalty on employers last July, despite it not being a part of the ACA.
The legislation also includes a number of other healthcare provisions, such as “more funding for research into diseases, improvements in the mental health treatment system, and an overhaul of the regulatory system for medical devices and pharmaceuticals,” according to Accounting Today.
Not only that, but the legislation also includes “funding to fight opioid drug abuse, collect genetic information from a million volunteers for medical research purposes and provide money to back Vice President Joe Biden’s ‘moonshot’ effort to find a cure for cancer,” Accounting Today reports.
Catch up on my current posts along with industry articles