Under the ACA employer mandate, employers with at least 50 full-time employees (FTEs) (including full-time equivalents) – known as “applicable large employers” (ALEs) – must offer affordable minimum value coverage to substantially all FTEs (those working 30 or more hours per week) and their dependents, or risk owing penalties through an employer shared responsibility payment (ESRP). Importantly, the IRS notifies employers of a proposed ESRP through Letter 226-J. The following FAQs address how ALEs will be notified of an ESRP, how employers should respond to or dispute the notification, and best practices for ACA reporting and recordkeeping.
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