Starting in 2018, employers offering health plans that exceed a certain cost (the total employee and employer cost) would be subject to a 40% excise tax on the amount above that value. For individual coverage, the threshold would be $10,200 and for family coverage the threshold would be $27,500.* The calculation includes the value of medical, dental, vision, reimbursement from HRA and FSA accounts, and employer contributions to HSA. The thresholds for both individual and family coverage would be indexed at CPI plus one percentage point.
Although it seems to be far down the road, we all know how quickly time flies. Have you started thinking about the potential effects of this tax on your business?
To learn more about the Cadillac tax and what you need to do to prepare now to avoid this tax in the future, contact us at: http://www.ibpllc.com/contact-benefit-planning-services/
*Certain high-risk professions would have higher cost thresholds.
