People who support small business will find this infuriating. As of July 1st, it is a crime for small businesses to assist employees with their healthcare costs. The IRS made it illegal, obviously with the administration’s guidance.
The IRS, Obama’s weaponized government agency, has invented a new healthcare rule out of thin air.
A small business ‘helping their workers buy insurance or pay medical bills can be fined 18 times more than larger employers that don’t provide coverage at all,’ the NFIB (National Federation of Independent Business) warned.
The government is punishing companies who help out employees for making healthcare affordable for employees despite the fact that the administration said Obamacare was to help the people.
Employers who do not offer a group health plan, but give their workers additional pay to compensate for the purchase of health insurance or direct medical expenses can be fined $100 per day, per employee. Over the course of a year that’s $36,500 per employee up to $500,000 in total. The penalty on businesses for failing to comply with the employer mandate is only $2,000 per year. This is according to the NFIB.
It’s enough to drive most small businesses out of business and the fine is more than what most if not all of these part-time employees make in salary.
This rule is not in Obamacare but rather it was developed by the IRS unilaterally. This is possible because Obamacare is open-ended. It established market reform restrictions on employer-provided group health plans. After-tax employer payment arrangements are among the restrictions. (After-tax treatment means the employer payments are treated as additional taxable wages paid to participating employees.) The IRS issued IRS issued Notice 2015-17 this year which enforces it for small businesses.
Fourteen percent of small businesses are helping their employees and they think they are doing a good thing. They will be punished for it.
People who have been employed in a business for three years or less can be assisted. This encourages businesses to fire people when they hit the three year mark.
The government is here to help.
Rep. Charles Boustany has introduced legislation in the House (H.R. 2911) and Sen. Charles Grassley, in the Senate (S.1697) to remedy the problem.