The Federal Poverty Line (FPL) safe harbor is one of the three IRS-approved methods employers can use to determine if their health coverage is affordable under the ACA employer mandate.
It’s the simplest and most conservative safe harbor—perfect for employers who want a fixed, easy-to-administer maximum premium for all full-time employees.
🧮 How It Works:
To use the FPL safe harbor, an employer must ensure that the employee’s required monthly contribution for self-only coverage does not exceed 9.02% of the federal poverty line for a single individual, divided by 12.
For 2025, the mainland FPL for a single individual is $15,060.
So the max affordable monthly contribution using this safe harbor is:
$15,060 Ă— 9.02% Ă· 12 = $113.20
If the employee’s required premium is $113.20 or less per month, the coverage is considered affordable—no need to calculate income or track wages.
🧠Why Employers Use It:
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Simple flat amount to apply across the board
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Doesn’t require tracking individual income
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Eliminates guesswork for compliance
This method is most commonly used by employers offering a lowest-cost plan to all full-time employees, regardless of income or pay structure.