8.3 - Federal Laws & Regulations Flashcards
Provides workers and their dependents with benefits in case of death, disability, or retirement
The federal insurance contributions act (FICA)
Who participates in FICA?
Almost everyone only a few are exempt
How is FICA funded?
Taxing income earned from labor is funded by both employees and employers
What income is subject to FICA tax for employed and self-employed people?
Employed: gross wage
Self-employed: net profits
FICA provides a number of benefits including:
Disability pay
Retirement pay
Survivor’s benefits
Dependents benefits
Medical benefits under Medicare
Establishes a state-run system of insurance to provide income to workers who have lost their jobs
The federal unemployment tax act
Who must participate in FUTA?
All employers who have quarterly payroll of at least $1,500 or who employ at least 1 person for 20 weeks a year
What is the federal unemployment tax rate?
6% on first $7,000 per year of compensation for each employee
Most employers must participate in worker’s compensation programs. There are exceptions for:
Agriculture workers
Domestic workers
Casual workers
Public employees
Independent contractors
The purpose of the affordable care act is to:
Improve access to health care in the U.S. by providing workers wit access to affordable health care coverage
Health care coverage maybe offered through:
A plan provided by the employer
A plan purchased through a health insurance market place
Coverage provided under a government sponsored program such as Medicare
Direct purchase by the employee from an insurance company
Employers with 50 or more full time employees are called:
Applicable large employers (ALE)
ALEs are required to:
Provide full-time employees the opportunity to purchase affordable minimum essential health care coverage fro themselves and their dependents under an eligible employer-sponsored health care plan
Who is considered a full time employee?
One who works 30 hours a week or 130 service hours a month
Coverage is considered affordable if the employee’s contribution to the plan:
Does not exceed 9.5% f the employee’s household income
