In King v. Burwell, opponents of the Affordable Care Act maintained that Congress only intended for people to receive subsidies, also called premium tax credits, in the states that have set up their own insurance marketplaces. If ruled in favor of the plaintiffs, the people of states with federally run health insurance exchanges would lose their subsidies. On June 25, 2015, in the case of King v. Burwell, the Supreme Court has ruled in favor of Burwell, that is, the Obama administration. The Court agreed that the subsidies are available for everyone who bought health insurance through an exchange, no matter whether that exchange was created by a state or the federal government.
What does this mean?
Because of this decision, nothing changes with the Affordable Care Act. Subsidies will continue to be available to individuals living in the 34 states with public health insurance exchanges run by the federal government as well as those living in the 16 states with state-run exchanges and the District of Columbia. The Affordable Care Act remains entirely intact, including Employer mandates and applicable reporting. As part of the Employer mandate, employers with more than 50 employees must offer health insurance to their full-time workers that is affordable and provides minimum essential coverage. The IRS has released Forms 1094/1095 that employers (subject to the Affordable Care Act) will be required to file in order to show that they are compliant with the Affordable Care Act requirements.
*Paylocity continues to advocate on your behalf and we stand ready to assist you with your ACA compliance. Thank you for choosing Paylocity as your Payroll Tax partner. Should you have any questions please contact your Paylocity Account Manager.