Determining if an employer meets the definition of Applicable Large Employer (ALE) is the first step in predicting tax penalty liability regarding employer shared responsibility rules under ACA. Employers must use the appropriate standard for determining and reporting their size. Each employee’s hours of service during 2014 are used to determine an employers ALE size for 2015.

Employers who average 50 or more full-time employees, including full-time equivalents (FTE’s), are subject to the Section 6056 reporting requirements and employer shared responsibility or “pay or play” rules. However, for 2015 only, employers who average between 50-99 may be eligible for a one year transition delaying employer shared responsibility penalties until 2016 if certain criteria are met (Section 6056 reporting requirements still apply) .

NEEBCo’s Large Employer Calculator provides employers with a documented method of determining ALE status every year.

• If you employed 50 or more individuals at one time during 2014, you may be considered an ALE.
• If you employed 50 or more individuals at one time during 2014, but also less than 100 individuals at one time during 2014, you may be eligible for the one year delay for medium-sized employers regarding employer shared responsibilities.

To obtain your ALE size determination, contact your NEEBCO representative.