8860 / How does an employer that has a common owner with another employer determine whether it is subject to the ACA shared responsibility provisions?

Two or more employers who are controlled by the same owner or are otherwise related are considered to be a single employer if those employers are treated as a single employer under IRC Section 414.¹ IRC Section 414 treats two or more employers as one if they are: (1) part of a controlled group of corporations, (2) trades or businesses that are under common control, (3) affiliated service groups or (4) related through other arrangements generally having the same effect as in groups (1)-(3).²

These employers are combined in determining whether they collectively employ 50 or more full-time employees for purposes of applicable large employer status. If the combined total number of full-time employees exceeds 50 full-time employees (including equivalents), each employer is subject to the shared responsibility provisions even if no single employer crosses the threshold.

---

1. IRC § 4980H(c)(2)(C)(i).

2. IRC §§ 414(b), (c), (m), (o).