ACA Penalty Calculator

How much could the IRS charge you? Employers who fail to comply with ACA reporting face penalties up to $3,340 per employee per year. Find out your exposure in 60 seconds.
$3,340 4980H(a) per employee
$5,010 4980H(b) per employee
240K+ ALEs required to file
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Step 1: Employees 1 of 3

Employee Information

Employees averaging 30+ hours/week or 130+ hours/month
Please enter your full-time employee count
Combined monthly hours of all part-time employees (max 120 hrs each)
Full-Time Equivalents (FTEs)
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Total FT + FTE
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Coverage Details

Please select Yes or No
Employee's required contribution does not exceed 9.02% of household income (or safe harbor amount)
Please select Yes or No
Please select Yes or No

Penalty Exposure Details

Number of full-time employees who received PTC from the Health Insurance Marketplace. Leave blank if unknown.

ALE Status


The information provided by this wizard is for educational purposes only. Always consult with a tax or legal professional to determine the correct information for your filing situation. BoomTax does not provide tax or legal advice.

Frequently Asked Questions About ACA Penalties

What is the ACA employer shared responsibility penalty?

Under Section 4980H of the Internal Revenue Code, Applicable Large Employers (ALEs) with 50 or more full-time and full-time equivalent employees must offer affordable, minimum value health coverage to at least 95% of their full-time workforce. Employers who fail to meet these requirements may face penalties known as employer shared responsibility payments.

What is the difference between the 4980H(a) and 4980H(b) penalty?

The 4980H(a) penalty applies when an ALE fails to offer minimum essential coverage to at least 95% of full-time employees. It is calculated on all full-time employees minus 30. The 4980H(b) penalty applies when coverage is offered but is either unaffordable or does not meet minimum value, and is assessed only for employees who receive a Premium Tax Credit through the marketplace.

How much is the ACA penalty per employee in 2026?

For the 2026 tax year, the 4980H(a) penalty is $3,340 per full-time employee annually ($278.33 per month), and the 4980H(b) penalty is $5,010 per applicable employee annually ($417.50 per month). These amounts are adjusted annually for inflation by the IRS.

What is an Applicable Large Employer (ALE)?

An ALE is an employer that had an average of at least 50 full-time employees, including full-time equivalents, during the prior calendar year. Full-time equivalents are calculated by dividing total part-time employee hours by 120. Employers under common ownership must combine their employee counts across all entities.

What forms do ALEs need to file?

ALEs are required to file Form 1094-C (transmittal) and Form 1095-C (one per full-time employee) annually with the IRS. These forms report information about the health coverage offered to employees. Use our ACA Filing Survey to determine your specific filing requirements.

How can I avoid ACA penalties?

To avoid ACA penalties, ensure you offer affordable, minimum value health coverage to at least 95% of your full-time employees, and file your 1094-C and 1095-C forms with the IRS on time. BoomTax is an IRS-authorized e-file provider that makes ACA filing fast and affordable, starting at $349.

Need to file ACA forms? Avoid penalties. Start for $349. Start Filing
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