Administration Issues Employer Regulations Under Affordable Care Act
On Friday, the U.S. Department of the Treasury and the Internal Revenue Service issued long-awaited proposed regulations detailing many of the employer responsibility provisions under the Affordable Care Act. The 144-page rule will be published in the Federal Register on Jan. 2. Comments on the proposed regulations are due March 18. In addition, a public hearing on the regulations will be held in Washington, DC, on April 23.
Employers may rely on the proposed regulations pending the issuance of final regulations or other applicable guidance. Any future guidance that is more restrictive will not be applied retroactively and employers will be given sufficient time to come into compliance with final regulations. No indication was given as to when final regulations might be issued.
The proposed regulations are technical and complex and cover many topics. ASA has prepared a brief summary of the key provisions of particular interest to staffing firms for its member companies.
Congress Meets Cliff’s Edge
Wall Street Journal
(12/31/12) Janet Hook; Siobhan Hughes
Senate Minority Leader Mitch McConnell (R-KY) and Vice President Biden planned Sunday to discuss the fiscal cliff stalemate by phone into the night. The Senate had planned to reach a deal by midafternoon Sunday, but that did not happen, so Senate Majority Leader Harry Reid (D-NV) recessed the Senate until today at 11 a.m. Some senators seem resigned to the idea that Congress will not reach an agreement today, meaning spending cuts and tax increases would go into effect Tuesday and Wednesday.
A Payroll-Tax Rise Is Likely
Wall Street Journal
(12/29/12) Sudeep Reddy
Payroll taxes are expected to increase starting on Jan. 1, no matter how the negotiations to avoid the fiscal cliff turn out. The idea of extending the tax break beyond Dec. 31 has dropped out of year-end negotiations between the White House and Congress, and as a result, U.S. workers across the income spectrum will likely see the Social Security payroll tax revert to 6.2% from 4.2%. For a typical American family earning $50,000 a year, that would mean $1,000 in additional taxes over the course of the year.
A cut to take-home pay would be certain to weigh on economic growth next year. The forecasting firm IHS Global Insight estimates the payroll tax’s value at about $113 billion a year, approximately 0.7% of annual U.S. economic output. A return to the 6.2% rate would trim the nation’s growth rate by about half a percentage point next year, IHS Global Insight says. Few lawmakers have discussed the measure in recent months, focusing instead on the larger battle over individual income tax rates.
Staffing Today Returns Jan. 2
In observance of New Year’s Day, Staffing Today will not be delivered Tuesday, Jan. 1.