The IRS announced that the ACA affordability percentage for plan years beginning in calendar year 2025 will be 9.02%. This is an increase from the 2024 affordability threshold of 8.39%.
The ACA affordability percentage affects whether the employer’s coverage satisfies one or more of the affordability safe harbors under the employer mandate regulations.
Applicable large employers (ALEs) will need to consider this affordability percentage in developing their health plan contribution strategies for the 2025 plan year. This increase may give employers more flexibility when setting employee contribution levels for 2025.
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This blog and its contents are not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.