8862 / If an employer offers health coverage to fewer than 95 percent of its full-time employees, how is the employer shared responsibility payment amount calculated?
To calculate this payment, the employer multiplies the number of full-time employees it employed for the year (minus up to 30, and the number of full-time employees who were offered coverage) by $2,000.2 For purposes of this calculation, a full-time employee does not include a full-time equivalent employee.
If the employer offers coverage for some months, but not for others, it must calculate its shared responsibility payment separately for the months in which coverage was not offered. The payment is equal to the number of full-time employees employed for the month (minus up to 30, and the number of full-time employees who were offered coverage) multiplied by 1/12 of $2,000. If the employer does not offer coverage to a full-time employee on any day of a calendar month, that employee is treated as not having been offered coverage for the entire month.3
1. IRC § 4980H(a).
2. Treas. Reg. § 54.4980H-5(a).