Hardship exemption to employer health insurance mandate for small businesses

(a)

In general

Section 4980H of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(e)

Hardship exemption for small businesses

(1)

In general

Subsections (a) and (b) shall not apply to any small business for any month if such small business is experiencing a hardship with respect to the calendar year in which such month begins. (2)

Hardship

A small business shall be treated for purposes of this subsection as experiencing a hardship for any calendar year if such business demonstrates to the satisfaction of the Secretary that such business— (A)missed two or more consecutive loan payments during such year, (B)is a debtor in a title 11 case (as defined in section 108(d)(2)) the pendency of which includes any portion of such year, (C)received a notice from a utility during such year that such utility is preparing to stop providing services to such business by reason of nonpayment of amounts owed for utility service, (D)received a notice of eviction of foreclosure during such year, (E)experienced a fire, flood, other natural or human-caused disaster that resulted in substantial damage to property of the business during such year, or (F)experiences such other hardship during such year as the Secretary may determine for purposes of this subsection. (3)

Limitation to 5 years of exemptions

Paragraph (1) shall not apply to any small business for any calendar year if such paragraph has applied to such small business for any 5 previous calendar years. (4)

Small business

For purposes of this subsection— (A)

In general

The term small business means, with respect to any calendar year, an employer who employed an average of not more than 100 full-time employees on business days during the preceding calendar year. (B)

Application of certain rules for determining employer size; treatment of full-time equivalents as full-time employees

Rules similar to the rules of subparagraphs (C) and (E) of subsection (c)(2) shall apply for purposes of this subsection.

(b)

Effective date

The amendment made by subsection (a) shall apply to months beginning after the date of the enactment of this Act. (c)

Hardship exemption not To be used as sole criteria for audit

Notwithstanding any other provision of law, whether the hardship exemption provided under section 4980H of the Internal Revenue Code of 1986 (as added by this section) applies with respect to a taxpayer shall not be taken into account by the Internal Revenue Service as the sole factor in determining whether to audit such taxpayer. (d)

Treasury study on additional indications of business hardship

(1)

Study

The Secretary of the Treasury shall conduct a study regarding the additional hardships which would be appropriate to add to the list of hardships in paragraph (2) of section 4980H(e) of the Internal Revenue Code of 1986 (as added by this section), consistent with the purposes of such section. (2)

Determination of additional hardships

Not later than 6 months after the date of the enactment of this Act, the Secretary of the Treasury shall, with respect to any hardship which the Secretary determines should be added to such list of hardships, add such hardship to such list by making the determination described in subparagraph (F) of such section. (3)

Report

Not later than 6 months after the date of the enactment of this Act, the Secretary of the Treasury shall provide a written report to Congress with respect to the study conducted under paragraph (1). Such report shall include a description of each hardship considered for inclusion in such list of hardships, whether the Secretary made the determination to include such hardship in such list, and the reasons that such hardship was or was not so included, as the case may be. (4)

References to Secretary of the Treasury

Any reference in this subsection to the Secretary of the Treasury shall include a reference to any designee of such Secretary.