Notice 2015-52: Excise tax, high cost employer-sponsored health coverage

Notice 2015-52: Excise tax, high cost health coverage

The IRS today released an advance version of Notice 2015-52 to continue the process of developing regulatory guidance regarding the excise tax on high cost employer-sponsored health coverage under section 4980I—also referred to as the “Cadillac tax.”

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Read today’s Notice 2015-52 [PDF 75 KB]


The so-called “Cadillac tax” applies to health care and related expenses paid for by employers, by imposing a 40% tax for health care coverage that is more expensive or mostly paid for by the employer. The tax does not apply until 2018.

To address employer questions, the IRS in February 2015 issued Notice 2015-16 to describe potential approaches to be incorporated in future proposed regulations regarding the excise tax. Notice 2015-16 set forth possible approaches that may be used in regulations relating to:

  • The definition of applicable coverage
  • The determination of the cost of applicable coverage
  • The application of the annual statutory dollar limit to the cost of applicable coverage

Today, the IRS issued Notice 2015-52 to supplement Notice 2015-16 by addressing additional issues under section 4980I—including:

  • The identification of the taxpayers who may be liable for the excise tax
  • Employer aggregation
  • The allocation of the tax among the applicable taxpayers
  • Payment of the tax

Notice 2015-52 addresses issues regarding the costs of applicable coverage that were not previously addressed in Notice 2015-16.

Comments are requested on these issues and on any other issues under section 4980I, and the IRS notice states that the to-be-released proposed regulations will provide further opportunity for comment.

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