Nonprofit Healthcare: Looking Ahead to 2018 and the Cadillac Tax
Beginning in 2018, organizations that provide high-cost employer-sponsored healthcare to employees will be required to pay a non-deductible excise tax, dubbed the “Cadillac tax.” Organizations that afford more than $10,200 per individual and $27,500 per family for employee healthcare will be taxed 40% of the overage amount (pre-tax employer contributions to HRAs, HSAa, FSAs, and MSAs are included). By 2018, the American Health Policy Institute predicts that 38% of large employers (with more than 1000 employees) will have to pay the tax, and 17% of all businesses in the US will be responsible for payment.