How do I determine whether I am an Applicable Large Employer (ALE)?

To see whether your organization is an Applicable Large Employer (ALE), calculate last year’s average number of full-time employees plus full-time equivalents (FTEEs). Follow these steps.

1) Count full-time employees

• Full-time = at least 30 hours/week or 130 hours/month.

• Record the count for each month of the prior calendar year.

2) Convert part-time hours to FTEEs

• For everyone not full-time, total their monthly hours.

• Divide by 120 to get FTEEs.

• Example: 240 part-time hours → 2 FTEEs (240 ÷ 120 = 2).

3) Combine monthly totals

For every month, add full-time employees plus FTEEs to get a monthly headcount.

4) Compute the yearly average

Next, sum the 12 monthly headcounts.
Then divide by 12 to find the average.

5) Decide ALE status

If the average is 50 or more (including FTEEs), your organization is an ALE for the current year. Otherwise, it is not.

Special considerations

• Seasonal worker exception. If you exceed 50 (including FTEEs) for 120 days or fewer solely because of seasonal workers, you may not be an ALE.

• Controlled groups. Businesses in a controlled or affiliated group must aggregate employees across the group when determining ALE status.

Why ALE status matters

• Employer shared responsibility. ALEs are subject to the ACA employer mandate.

• Reporting. ALEs must file Forms 1094-C and 1095-C to report offers of health coverage.

Need help? We can run the calculations and handle the filing.
Email support@1099fire.com or call (480) 706-6474.