Obama’s IRS has ruled that employers cannot hand tax-free contributions to their workers and tell them to purchase health insurance. First reported by the The New York Times reported, and further expanded on by Newsmax, this means that employers who want to dumping employees into ObamaCARE exchanges to avoid the penalty are now prohibited.
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| IRS employers can’t dump workers into ObamaCare exchanges |
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The Affordable Care Act requires large employers to provide healthcare coverage to their full-time workers. Some companies figured it was less expensive to give each employee money to purchase their own coverage on an exchange rather than providing coverage through group policies.
The ruling comes as a blow to many employers who gave their workers tax-free cash contributions to purchase coverage. Andrew Biebl, a tax partner at CliftonLarsonAllen in Minneapolis, said the idea of giving workers money to buy their own insurance preceded Obamacare.
“For decades, employers have been assisting employees by reimbursing them for health insurance premiums and out-of-pocket costs,” Biebl told the Times. “The new federal ruling eliminates many of those arrangements by imposing an unusually punitive penalty.”