The Affordable Care Act is being rolled out in phases, but many people--both employers and employees alike--are confused about what these changes mean for them. If you're self-employed or have a small business, the ACA will most likely help you save money on health insurance. You should know, though, that according to the ACA, a small business employs 50 people or less. If you have more than 50 employees, it's even more important that you keep up with the new laws to avoid potential fines. Small Business Health Options Program (SHOP) A new marketplace for health insurance is available to small businesses. In 2015, any business with 50 employees or less can access this site for a quote. It's open to both employers and employees, and the goal of SHOP is to provide low-cost, high-quality insurance plans to everyone. There are a few requirements for using SHOP, however. For one, you must have at least one employee; self-employed individuals aren't eligible for this particular program. (If you're self-employed, use the individual Health Insurance Marketplace instead.) Also, you must offer SHOP to all your employees, and a certain amount of employees must agree to participate. This amount is 75% in Arkansas, Iowa, Nevada, New Hampshire, New Jersey, South Dakota, and Texas; 50% in Tennessee; and 70% in all other states. Employees who have any other insurance, with the exception of individual private coverage, are excluded from the minimum participation requirement. Health Care Tax Credits Businesses with less than 25 employees may be eligible for a tax credit if they sign up for coverage through SHOP. The average employee salary must be $50,000 or less and the employer must pay half (or more) of the total insurance premium for each employee. If these requirements are met, up to 50% of the amount you contribute toward your employees' premiums is available as a tax credit. Employer Shared Responsibility Provisions In 2015, employers with 50 or more full-time employees are required to offer insurance coverage to their employees and their dependents. Those who don't will face a fine of up to $2,000 per employee. Any employee who works 30 hours or more per week is considered full-time; a combination of full-time and part-time employees that equal 50 employees may also be subject to the provision. This provision goes into effect on January 1, 2015, and the 50 employees requirement will be based on the company's employment history in 2014. At least 95% of full-time employees must be offered health insurance to meet the requirements of the provision.
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