- You must have fewer than 25 full-time equivalent (FTE) employees.
- The average annual wage of all employees must be less than $50,000.
- You must contribute at least 50% of each employee’s insurance premium. You must also contribute at the same rate to any add-on coverage such as dental or vision coverage. (Contributions are based on the employee-only premium; for employees with employee-plus-one or family coverage, you must contribute at least 50% of the employee-only premium amount. You are not required to contribute at least 50% of the employee-plus-one or family premium amount.)
3. You can calculate the number of FTE employees you have by totaling the number of hours worked by your employees, or you can estimate it based on the number of days or weeks worked. Do not include any overtime when totaling the number of hours worked. Divide the total hours by 2,080 (2,080 is the number of hours worked in 40-hour work week for a single year), and round down to the nearest whole number.
4. Owners and their employed family members are excluded.
An owner is excluded if they are:
- A sole proprietor
- A partner in a partnership
- A shareholder owning more than 2% of an S corporation or an owner of more than 5% of other types of businesses
Employed family members are excluded if they are:
- Children or grandchildren
- Siblings or step-siblings
- Parents or grandparents
- Nieces or nephews
- Aunts or uncles
- Sons-in-law or daughters-in-law
- Fathers-in-law or mothers-in-law
- Brothers-in-law or sisters-in-law
This means their hours and wages do not apply to the number of FTE employees, the hours worked, the amount of average annual wages, or the amount of premium contribution.