The IRS announced that the 2024 health plan affordability threshold—which is used to determine if an employer's lowest-premium health plan meets the Affordable Care Act's (ACA's) affordability requirement—will be 8.39 percent of an employee's household income. That's down from this year's 9.12 percent figure. The information was detailed in IRS Rev. Proc. 2023-29, which was released last week. The 2024 threshold is a significant decrease from 2023, and it is the lowest affordability threshold since the ACA was implemented.
IRS Announces 2024 Health Plan Affordability Threshold
SHRM | Aug 2023
Revenue Procedure 2023-29
Affordability and Minimum Value
IRS
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Importantly, employers that use the exact safe harbor dollar amount to set employee contributions will need to reduce the current employee contribution for the lowest-cost, self-only option for the 2024 plan year.
2024 affordability percentage for employer health coverage drops
Mercer | Aug 2023
As with previous decreases to the affordability percentage, applicable large employers (ALEs), generally employers with 50 or more full-time and full-time equivalent employees, need to be aware of certain pitfalls.
IRS Lowers ACA Affordability Percentage for 2024
Gallagher | Aug 2023
There are three "safe harbors" for affordable employer-provided coverage under the ACA: the Federal Poverty Level Safe Harbor, the Rate of Pay Safe Harbor and the W-2 Wages Safe Harbor. An employer must meet one of them to show that the coverage it has offered employees is affordable.
IRS Announces 2024 Rate for Affordability Calculations under the ACA
Keenan | Aug 2023
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