Congress approves delay of several ACA taxes

As part of the agreement by the Senate and HouseOpens a new window to fund the government and end the shutdown, the following taxes have been delayed:

  • Excise or “Cadillac” Tax will now apply to high-cost benefits that are provided in 2022.  This tax is a 40% excise tax on employer sponsored health coverage exceeding certain benefit thresholds.  It originally applied to benefits provided in 2018, but then was delayed to 2020 and now will now apply to benefits exceeding the threshold beginning in 2022.
  • Health Insurer Fee will have a one year delay for 2019 only.  This fee was delayed for 2017 and is currently in force for the 2018 year.
  • Medical Device Tax will be delayed for 2018 and 2019.

In addition the Children’s Health Insurance Program (CHIP) will be funded and continue for six more years.

Earlier tax legislation removed the penalty for the Individual Mandate beginning in 2019.  

As noted in earlier communications, these changes are delays or modifications to the Affordable Care Act (ACA); however, the ACA is still the law of the land.