Does the ACA affordability test apply to employers with fewer than 50 employees?

The employer shared responsibility rules apply to applicable large employers, meaning 50 or more full-time equivalent employees. Smaller employers are not subject to the payment, but the same percentage can be a useful benchmark when you set contributions. Check your headcount with your adviser, because the count includes part-time hours.

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What to know

The short answer, in three parts.

Who is covered

Applicable large employers, with 50 or more full-time equivalent employees on average.

Counting

Full-time equivalents include part-time hours, so the count can be higher than your full-time headcount.

Smaller employers

Not subject to the payment, but the percentage is a useful benchmark for contribution decisions.

Keep reading.

The guide

The 2027 ACA Affordability Percentage: Employer Guide

What the IRS changed for 2027 and what to check before open enrollment. Back to the guide.

Next step

Read about groups of 2 to 50 employees.

Sources

Where these figures and rules come from.

Sources

Figures and rules

IRS Rev. Proc. 2026-26 (2027 affordability percentage of 10.22%, up from 9.96% for 2026) and Rev. Proc. 2026-22 (2027 employer shared responsibility payment amounts). IRC §4980H; 26 CFR §54.4980H-5(e). This page is general information, not legal or tax advice.

Let’s Get to Work

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Where does your group fall?

2 to 50 employees

250 to 999 employees

Above 50 employees