The number on Line 15 of Form 1095-C is the employee’s required monthly contribution for the lowest-cost self-only health plan offered by the employer, used by the IRS to determine affordability of coverage relative to household income.
This amount is reported even if the employee did not enroll in the employer’s health plan.
Applicable Large Employers (ALEs) are subject to the employer shared responsibility provisions of the Affordable Care Act - also known as the "employer mandate." Per the mandate, the ALE must either offer minimum essential coverage that is “affordable” to their full-time employees or make an employer shared responsibility payment (ESRP) to the IRS.
What is an "Affordable" offer of coverage?
In general - whether offered health insurance coverage via a traditional group plan or an ICHRA - measuring the affordability of the offer of coverage is based on a measure of the monthly employee contribution (i.e., the employee's share of the insurance premium) vs. the employee's income.
While the specific numbers vary year-to-year, the rules essentially indicate that people shouldn't have to spend more than ~9% of income on health insurance premiums.
What is Line 15 on Form 1095-C?
Line 15 shows the monthly cost an employee would have paid for the lowest-cost, self-only health coverage offered by the employer.
This is not:
The amount actually deducted from paychecks
The cost of the plan the employee chose
The total cost of family or dependent coverage
It is strictly the employee’s required contribution for the lowest-cost option available to them.
For an ICHRA program, calculating the monthly Employee Required Contribution for Line 15 is a bit more complex than with a traditional group health plan. This is because health insurance premiums in the individual market tend to vary by geography and age. Don't worry - Take Command has the market data and is here to help!
The simple formula for calculating the amount to enter on Line 15 is below:
Employee Required Contribution = LCSP Premium - ICHRA Allowance
LCSP = Lowest-cost silver plan an employee could purchase on the marketplace
ICHRA Allowance = Amount of $$ employer offering per month via ICHRA program
To calculate the LCSP premium, we need to look at geographic location (either the employee's address or employer's work-site location) and the employee's age.
Why is Line 15 reported even if I didn’t enroll?
Line 15 is reported because the IRS uses it to determine whether an employer’s health coverage offer was:
Affordable under ACA rules
Properly reported under employer mandate requirements
It is required reporting for Applicable Large Employers, even if:
The employee declined coverage
The employee was covered under another plan (e.g., spouse or parent)
The employee never enrolled in employer coverage
How is the Line 15 amount calculated?
Line 15 is based on:
The lowest-cost silver-level or minimum-value self-only plan offered by the employer
The employee’s required monthly contribution for that plan
Employer affordability calculations under ACA rules
For ICHRA arrangements, the IRS affordability logic generally follows:
Cost of lowest-cost self-only plan
Minus employer ICHRA allowance (if applicable)
Result = employee required contribution used for reporting
Does Line 15 mean money was taken from my paycheck?
No.
Line 15 does not represent payroll deductions or money withheld.
It only represents:
A calculated monthly cost
Used for IRS reporting and affordability testing
Not an actual payment unless the employee enrolled in coverage and contributed via payroll deductions
How does Line 15 relate to household income?
The IRS compares Line 15 to household income to determine affordability:
If Line 15 is too high relative to household income, coverage may be considered unaffordable
If coverage is affordable, the employee is generally not eligible for premium tax credits on Marketplace plans
If unaffordable, the employee may qualify for subsidies (if other requirements are met)
The affordability threshold is based on a federal percentage of household income that changes yearly.
What if Line 15 looks incorrect?
Line 15 may appear unexpected if:
You did not enroll in employer coverage
You are covered under a different plan (spouse, parent, Marketplace)
You are comparing it to paycheck deductions (which are unrelated)
You are seeing a calculated value based on a plan you never selected
If the number seems wrong:
Confirm the employer’s lowest-cost plan details
Verify your employment and coverage status for that month
Contact your employer or benefits administrator for correction
Can you provide additional resources?
For more on the topic of affordability and ICHRA:
As a reminder, Take Command Health is not a licensed tax preparer. Please consult a tax professional, CPA or attorney if you have questions.