2027 ACA Affordability Calculator for Employers

How Does This ALE Calculator Screen the ACA Employer Mandate? 

 This tool functions as both an ALE calculator and an ACA FTE calculator. It estimates Applicable Large Employer status using the full-time employees and full-time equivalent employees you enter, then screens key ACA employer mandate issues including the 95% offer threshold, affordability, minimum value, and potential common-ownership aggregation. The IRS determines actual ALE status using monthly prior-year workforce data, so this public calculator is a planning and screening tool rather than a formal ACA determination. 

Which 2027 ACA Affordability and §4980H Figures Does the Calculator Use? 

 For plan years beginning in 2027, the calculator uses the 10.22% ACA affordability percentage established by IRS Rev. Proc. 2026-26. It also displays the 2027 indexed Employer Shared Responsibility Payment amounts under §4980H: $3,780 annually for the adjusted §4980H(a) amount and $5,670 annually for the adjusted §4980H(b) amount. These indexed amounts are inputs to the statutory payment calculations and are not automatic penalties or amounts an employer necessarily owes. 

What it does not do

It does not determine whether your entities form a controlled or affiliated service group under § 414 — it takes your answer at face value. It does not apply the W-2 or rate-of-pay affordability safe harbors, which may produce a different affordability result. It does not read your plan documents, and it cannot see hours of service that are not in the numbers you type.

Assumptions you should know about

• Hours of service for employees who are not full-time  are converted using the 120-hour divisor. For ALE determination, those hours are capped at 120 per employee per month, combined, and divided by 120. 
• Full-time status is tested at 30 hours per week or 130 hours per month
• Affordability is screened against the federal poverty line safe harbor.
• Your answers about common ownership are accepted as given; the tool does not test the § 414 relationship
• Results reflect the plan-year figures noted above and are not updated to your specific plan year

Reading the result honestly

A result of “not an ALE” is only as good as the hours you entered. If you typed headcount instead of hours of service, or omitted paid time off, the count is low. A result of “affordability risk” means the federal poverty line method would likely fail — it does not mean you have a penalty, because the W-2 and rate-of-pay safe harbors may still apply and they may produce a different result.

Neither result is a filing position. Both are prompts to check the underlying data.

What to do with each outcome

• Clearly under 50:  Document the calculation and repeat the ALE analysis annually. If the employer is not an ALE, the § 4980H employer shared responsibility provisions and ALE information-reporting requirements generally do not apply for that year. Other ACA or health-plan obligations may still apply. Next step: Talk to a 4J Benefits Broker if you want help evaluating how future growth could affect your ACA obligations. 
• Near 50:  Rebuild the calculation from actual payroll hours of service, month by month, including applicable paid leave, and evaluate all entities that may need to be aggregated under § 414. Next step: Request a 4J Benefits Review to discuss the insurance and benefits implications of approaching ALE status. 
• 50 or more: Confirm the employer's ALE status using complete prior-year workforce data and review the applicable employer shared responsibility and information-reporting requirements. Next step: Schedule an ACA Benefits Strategy Review with 4J to evaluate your benefit structure, contribution strategy, carrier options, and implementation timeline. 
• ALE with an affordability result that clears the screen: Document the affordability safe harbor being relied upon, confirm the offer otherwise satisfies applicable ACA requirements, and address required Forms 1094-C and 1095-C reporting. Next step: Review Your 2027 Benefits Strategy with 4J if you want to validate the insurance and contribution strategy before renewal or implementation. 
• ALE with flagged affordability risk: Before the applicable plan year begins, have the employee contribution structure, minimum-value offer, affordability safe-harbor strategy, and relevant plan terms reviewed by qualified ERISA/employee benefits counsel and, where appropriate, a qualified tax adviser. After counsel has reviewed the structure and provided guidance, Schedule Your Post-Counsel Implementation Review  so we can help implement the insurance and benefits strategy consistent with that guidance. 4J Insurance is an insurance brokerage, not a law firm, and this calculator does not provide legal or tax advice or constitute a determination of ACA compliance. 

Important Compliance Notice 

This calculator is intended for educational, planning, and preliminary screening purposes only. It does not constitute legal, tax, actuarial, payroll, ERISA, or formal ACA compliance advice, and it does not determine whether an employer owes a payment under IRC §4980H.

Questions involving IRC §414 aggregation, ERISA requirements, affordability safe harbors, plan documents, or potential employer shared responsibility exposure should be reviewed with qualified legal or tax counsel. After that review, 4J Insurance can help implement the insurance and employee-benefits strategy consistent with counsel’s guidance.

4J Insurance is an independent commercial insurance brokerage, powered by PGI, based in Frisco, Texas. Coverage availability and plan obligations depend on the employer’s specific facts, plan documents, carrier requirements, and plan year.