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Category: California Employment Law
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Experience:  I have 30 years of experience in the practice of law, including employment law and discrimination law.
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# My company has 21 employees and currently we offer health insurance

My company has 21 employees and currently we offer health insurance to our employees but the employees pay 100% of the premium so there is no cost to the company for the healthcare insurance. I like to know how the Obamacare laws will impact our company in term of cost on the health insurance as well as any tax increase that is associated with this new laws. Thank you.

Good morning Becky,

I'm Doug, and I'm sorry to hear of the confusion. My goal is to provide you with excellent service today.

Fortunately for small businesses like yourself, until you have at least 50 full time employees on average over a period of a year, you are not going to be subject to the Affordable Care Act.

ObamaCare and the huge mess that it is will not impact you as an employer.

Not that you need to know right now, but perhaps for the future you might want to know how the number of employees is determined:

To determine whether an employer is a large employer for purposes of the Affordable Care Act, (Obamacare) the following formula is used to calculate the 50 employee threshold:

The math to determine whether a company must abide by the Act is done as follows.

1. Any employee who works at least 30 hours per week in any month is counted as one full-time employee.
2 For all employees working less than 30 hours per week average in any month, you add up all of the hours worked by all of these part time employees during the month and divide by 120. The resulting number is XXXXX number of equivalent full time employees that you have. Seasonal employees who do not work over 120 days, can be omitted from the employer's calculation of "full-time" employees regardless of how many hours they work.

For example, let’s say that you have 5 full time employees and 20 part time employees who work an average of 72 hours per month. 20 X 72 is 1440 total part time hours worked. Divide that by 120.
1440/120 = 12.

That would mean that you have the equivalent of 12 full time employees working part time, 5 employees actually full time, for a total of 17 full time employees for that month. Add the number of full time employees you got for the 12 months of the calendar year, and divide by 12. If that resulting number is XXXXX than 50, then you are covered by the Affordable Care Act.

However, for now you don't need to worry about that---the Act simply does not apply to you.

You may reply back to me using the Continue the Conversation or Reply to Expert link and I will be happy to continue to assist you until I am able to address your concerns, to your satisfaction.

Please remember to rate my service to you when our communication is completed.

I wish you the best in 2013,

Doug

Customer: replied 4 years ago.

Thank you, XXXXX XXXXX about the increase in the Medicare tax, would and when it be applied to my company?

Hi Becky,

If there is a MediCare tax increase, it will apply to all employees nationwide, and at the same time---not just to larger employers and their employees.

If you are talking about the 0.9% increase in MediCare tax that applies to wages above \$200,000 for individuals and \$250,000 for couples, I believe this now las has already taken effect as of the first of the year.

You may reply back to me using the Continue the Conversation or Reply to Expert link and I will be happy to continue to assist you until I am able to address your concerns, to your satisfaction.

Please remember to rate my service to you when our communication is completed.

I wish you the best in 2013,

Doug