Employer Shared Responsibility Payment

Employer Shared Responsibility Payment

Wed, 12/09/2020 - 20:39
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The Affordable Care Act requires certain employers with at least 50 full-time employees (or equivalents) to offer health insurance coverage to its full-time employees and their dependents.

The health insurance needs to meet certain minimum standards set by the Affordable Care Act.

If the employer fails to do this, they will be assessed a tax penalty called the Employer Shared Responsibility Payment (ESRP).

A maximum yearly penalty of $2,700 (for 2021) per full-time employee (minus up to 30) will be incurred if the employer fails to offer minimum essential coverage to 95% of its full-time employees and their dependents.

The penalty being calculated on a monthly basis.