Free tool
Are you an ACA large employer?
The 50-employee threshold that triggers the health coverage mandate does not count people. It counts full-time equivalents, and part-time hours add up into whole employees.
Anyone averaging 30 or more hours a week.
Everyone under 30 hours a week, added together. Cap each person at 120 hours.
Full-time
0
Part-time equivalents
0
0 ÷ 120
Your FTE count
0
You are below the threshold, with room
The ACA employer mandate does not apply at this size. Plenty of other rules still do — headcount thresholds start well below 50.
FTE count is only one threshold. Plenty of others land well before it — OSHA logs at 11, discrimination law at 15, COBRA at 20.
See everything that applies to youHow the math works
Every employee working 30 or more hours a week counts as one full-time employee. Then you take all the hours worked by everyone else in the month, and divide by 120. That gives you your part-time contribution in whole equivalents. Add the two together.
Two details catch people out. First, each part-time employee’s hours are capped at 120 in a month for this purpose. Second, and more importantly, your actual status is based on your average across the whole prior calendar year, not today’s number. That means you cross the line retroactively — you find out you were a large employer for a year that has already ended.
This calculator does the simplified single-month version, which is the right tool for knowing whether you are close. If you land anywhere near 50, work the full-year calculation with your accountant rather than guessing.
Source: IRS — Determining if an employer is an Applicable Large Employer ↗
Common questions
How do I calculate full-time equivalents?
Count every employee averaging 30 or more hours a week as one full-time employee. Then add together all hours worked in the month by everyone else, capping each person at 120 hours, and divide that total by 120. Add the two figures together for your FTE count.
What is the 50-employee threshold for health insurance?
At 50 full-time equivalents you become an Applicable Large Employer under the Affordable Care Act. You must offer affordable, minimum-value health coverage to full-time employees or face penalties under section 4980H, and you must file IRS Forms 1094-C and 1095-C.
Do part-time employees count toward the 50 threshold?
Yes. Their hours aggregate into full-time equivalents. This is the single most common misunderstanding — a business with 35 full-time and 30 part-time staff can already be an Applicable Large Employer even though nobody thinks of it as a 50-person company.
Is Applicable Large Employer status based on this year or last year?
The prior calendar year. Your status is determined by your average FTE count across the previous year, which means you can discover you were a large employer for a year that has already ended.