Cadillac Tax Delayed Until 2020
Posted on: 12/22/2015 9:36 AM
An omnibus bill that delays the Affordable Care Act's so-called "Cadillac tax" was passed by Congress on December 18. The bill included two important providing related to the Cadillac tax. First, the implementation is now delayed by two years, effective starting in 2020. Second, it allows the tax to now be considered a deductible expense for tax purposes.
As a reminder, the Cadillac tax would impose a 40% excise tax on the portion of group health plan costs that exceed $10,200 for single coverage and $27,500 for family coverage, and includes not only premiums but FSA and HSA contributions as well.
While these provisions that changed are important, we continue to advocate on behalf of our clients for full repeal or reform of this tax.