As the year winds down, the fourth quarter brings not only the busy holiday season but, for business owners, busy year-end tasks.
If you offer health insurance coverage to your employees, you’re likely going through your annual open enrollment process and preparing for 2025 changes. Below, find a few things to be aware of as you work through these year-end tasks and prepare for 2025 — and remember, insurance can be overwhelming at times, so reach out to your broker if you need help.
Your Applicable Large Employer (ALE) Status for 2025: The ACA’s employer mandate rules apply only to ALEs, which are employers with 50 or more full-time employees (including full-time equivalent) on business days during the preceding calendar year. Employers determine each year, based on their current number of employees, whether they will be considered an ALE for the following year.
ACA Affordability: The ACA requires ALEs to offer affordable, minimum-value health insurance coverage to their full-time employees or risk paying a penalty to the IRS. In 2025, the affordability percentage is going up slightly to 9.02% from 8.39% in 2024.
Reporting Deadlines: Is your company subject to ACA reporting under Code Sections 6055 or 6056? If so, the following deadlines would apply to you:
- March 3, 2025: Individual statements for 2024 must be furnished to employees by this date. An alternative method of furnishing form 1095-B is available.
- March 31, 2025: Electronic IRS returns for 2024 must be filed by this date.
If you have any questions about these deadlines, please consult with your broker, or reach out to me.
Flex Spending Accounts (FSAs): The annual maximum plan contribution limit for FSAs is projected to increase from $3,200 to $3,300 in 2025. The FSA maximum rollover limit is also projected to increase from $640 to $660 in 2025.
Health Reimbursement Arrangements (HRAs): For 2025, the maximum contribution for excepted benefit HRAs is $2,150.
Health Savings Accounts (HSAs): The HSA contribution limit for 2025 is $4,300 for self-only coverage and $8,550 for family coverage. Those 55 and older can contribute an additional $1,000 as a catch-up contribution.
Legal Notices: There are many notices that you need to provide to employees throughout the year. These include — but are not limited to — Summary of Benefits Coverage (SBCs), Medicare Part D, annual CHIP notice, initial COBRA notice, HIPAA notices and WHCRA notices.
A great resource for small businesses is the “Employee Benefits for Small Businesses” Business Toolkit. Please feel free to reach out and I would be happy to provide one to you.
Happy year-end!
Katy Rosecrans, SHRM-CP
Employee Benefits Advisor
Bell Insurance
