All the talk is about AFFORDABLE health coverage but what is affordable health coverage?
If an employee’s share of coverage (for employee-only coverage) costs the employee more than 9.5% of the employee’s annual household income, then the coverage is NOT affordable.
Since we do not know an employee’s annual household income, the IRS has three safe harbors we can use instead.
Safe Harbors:
An employer may choose to use one or more of the safe harbors for all of its employees or for any reasonable category of employees, provided it does so on a uniform and consistent basis for all employees in a category.