The Internal Revenue Service (IRS) has released a number of increases for the 2016 year, here are some that are of interest:
Relating to the Affordable Care Act, the “affordability” percentage for 2016 is 9.66% and the Pay or Play penalties for 2016 have increased as follows: Subsection (A) Penalty: $2,160; Subsection (B) Penalty: $3,240. Remember the Subsection (A) Penalty applies to an employer that fails to offer 95% of its Full Time Employees (“FTEs”) coverage and the Subsection (B) Penalty applies to an employer that fails to offer coverage that is Minimum Essential, Minimum Value and Affordable.
Relating to mileage reimbursement rates for medical care, for 2016, the rate is $.19/per mile, down from $.23 in 2015. To review additional requirements for a taxpayer to use a standard mileage rate to calculate the amount of a deductible business, moving, medical or charitable expense, please see Rev. Proc. 2010-51 and Notice 2016-01.