---
title: Increased ACA Penalty Amounts for 2024
description: The ACA provides for two different Employer Shared Responsibility payments, each of which is updated by a COLA factor annually. The updated 2024 penalty am
---

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# [Increased ACA Penalty Amounts for 2024](https://vitacompanies.com/blog/increased-aca-penalty-amounts-for-2024)

 Written by [Vita](https://vitacompanies.com/blog/author/vita) | May 9, 2023

The ACA provides for two different Employer Shared Responsibility payments, each of which is updated by a COLA factor annually. The updated 2024 penalty amounts have recently been released.  
 

### **Two Types of Penalties**

**Subsection "A" Penalty:** The Code: 4980H(a) penalty may be levied if an Applicable Large Employer fails to offer minimum essential coverage to at least 95% of full-time employees (and their dependents) for any month. The full penalty can be triggered by just one employee receiving a premium subsidy under the Exchange. The penalty is calculated based on the total number of full-time employees of the employer (minus 30) in any month in which an employee received a subsidy.

**Subsection "B" Penalty:** The Code: 4980H(b) penalty may be applied if an Applicable Large Employer offers minimum essential coverage to the required number of full-time employees, however, the offered coverage is not affordable or does not provide minimum value. This penalty is applied on a 1:1 basis whereby a penalty is applied for each employee each month they receive a premium subsidy under the Exchange.

**Trigger for Penalties:** Either or both penalties are triggered by an employee receiving subsidized coverage under the Exchange (when they otherwise could/should have been offered employer sponsored coverage).  
 

### 2024 Penalty Amounts

**Subsection "A" Original Penalty of $2,000: **Increased for 2024 to $2,970 ($282 per month)

**Subsection "B" Original Penalty of $3,000:** Increased for 2024 to $4,460 ($372 per month)  
 

### Effective Date

These updated penalties are effective for tax years and plan years beginning after December 31, 2023.  
 

### Reference

These updates were made in the IRS revenue procedure, **[Rev. Proc. 2023-17](https://www.irs.gov/pub/irs-drop/rp-23-17.pdf)**.

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