June 3, 2025
🏛️ Court Ruling Shakes Up ACA Penalty Process
🔍 What Happened?
A Texas janitorial company challenged a 2019 ACA penalty and won. The court said:
➡️ The IRS must wait for HHS to certify employer liability
➡️ The current use of Letter 226-J violates the ACA
➡️ HHS can’t delegate its role to the IRS
💼 What It Means for Employers
While the ruling only applies to the company that sued, it could open the door for others to:
✔️ Dispute ACA penalties
✔️ Request refunds (within 3 years of filing or 2 years of payment)
⚠️ It’s still unclear if the government will appeal or how enforcement will change.
🧠 Quick Recap
- ACA requires large employers (50+ FTEs) to offer affordable, qualifying health coverage
- Penalties apply if even one employee gets subsidized ACA coverage
- This court ruling could weaken the current enforcement process
📣 Tip: If you’ve been hit with a penalty, talk to a tax or legal advisor — this case may give you leverage.
If you would like to talk more about this, give us a call at 520-721-4848.
