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Individual Mandate Penalty Will Be Eliminated

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On December 20, 2017, Congress passed the Tax Cuts and Jobs Act, which the President will be signing into law soon. The bill is the first piece of major tax reform in over 30 years and is also significant because it eliminates the Individual Mandate of the Affordable Care Act (ACA) in 2019. As a result, individuals are still liable for a penalty for failure to obtain acceptable health coverage for the current year and in 2018 (the penalty will be assessed when federal income taxes are filed in 2019).

It is important to note the new tax bill did not repeal other ACA provisions. Therefore, employers should continue to comply with the ACA, including Cadillac tax, PCORI and other provider fees, Employer Shared Responsibility Provisions (Pay or Play) and ACA Reporting (Sections 6055 and 6056).  

Click here for highlights of the new tax bill, including important dates and the impact of the Individual Mandate repeal.