I just read a press release titled,  “NO KIDDING: THIS WEEK IRS STARTS PUNISHING BUSINESSES FOR HELPING WORKERS BUY INSURANCE”  Dated: June 29, 2015 (written by Jack Mozloom)

Frankly, it has me shaking in my boots because I fear many small business owners are in for a shock they never saw coming.

“It’s the biggest penalty that no one is talking about,” said NFIB Policy Director Kevin Kuhlman.  “is the penalty for compensating (via their paycheck or reimbursement) employees for healthcare-related expenses is enough to destroy most small businesses.”

I’m compelled to share it with you because you or someone you know might be putting your/their business at risk for trying to do the “right thing”.

In my role as a Business Performance Advisor with Insperity, I meet hundreds of small business owners throughout the greater Los Angeles area.  Countless have shared with me that they’re going to either continue or start to subsidize their employees’ health insurance and let them buy their own through the CA exchange.  

This law, that went into effect in June, 2015, will have a huge impact on these small business owners when they file their tax returns and they’re hit with huge fines.  

Kuhlman wrties, “Under the rule, which appears nowhere in the Affordable Care Act, 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’ adds up to $36,500 per employee with a maximum of $500,000 in total.”

“Reimbursing employees for the cost of insurance or medical services is a way for small businesses to help their workers without the administrative headache of setting up a costly group plan,” said Kuhlman.  “Most small employers don’t have an HR departments or benefits specialists, so this is a simpler, easier way to help their employees.”

There is a solution for small and medium-sized business that does not require hiring an HR department or a benefits specialist.  You can outsource your HR and benefits management to Insperity. With over 26 years providing outsourced employee administration, HR, health insurance and benefits management – Insperity will provide a team of HR experts who will work with you to ensure your business is compliant and enable your small business to provide Fortune 500 level benefits to attract and retain key team members.

I would be delighted to speak to you about your business needs.  Please call me at (818) 231-5238 or send an email to robert.grossman@insperity.com