Employers urge Trump administration to pull back on Obamacare mandate

The employer mandate — the only Obamacare tax Congress did not repeal or delay this year — has business groups urging the Trump administration to pull back from trying to collect as much as $4.3 billion from companies that are now on the hook for assessments.

Companies have cried foul about the tack the Internal Revenue Service has taken to collect the assessments, arguing that they weren’t given proper warning or due process and that the administration has violated clear provisions in the Affordable Care Act that outlined how the mandate should be enforced.

A broad coalition that includes the U.S. Chamber of Commerce and the National Retail Association argued in a letter to top officials that the “administration’s enforcement efforts violate the ACA’s express guarantee that employers be given ‘two bites of the apple’ before tax penalties can be assessed.”

They said the “cost, complexity and confusion surrounding compliance with the employer mandate” warrants suspension of the notice letters the IRS continues to send out.

Last fall, the agency began to warn employers via letter that they owed penalties for the 2015 calendar year. The letters continued while GOP-led Congress began to signal they would at least temporarily lift most of the other Obamacare levies such as the Cadillac Tax and health insurance tax. Congress even effectively eliminated the individual mandate penalty as the IRS sent at least 10,000 assessment letters to employers.

The agency estimates that more 30,000 companies owe money, according to testimony this April before the House Oversight and Government Reform Committee.

In one assessment letter obtained by Modern Healthcare last year, the IRS said the company in question needed to pay more than $3.8 million and allowed 30 days to respond with the money owed or evidence that the agency assessed an incorrect penalty.

Companies have been weighing legal action since late last year, and legal consultant Christopher Condeluci ,who has been advising business groups on the issue, said they continue to do so.

Although Congress hasn’t made a move to delay or repeal the employer mandate,House lawmakers last week proposed to delay the health insurance tax again until 2021.

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