In 2017 Congress enacted the Tax Cuts and Jobs Act, which reduced the individual mandate penalty to zero, effective January 1, 2019. Recently a federal district court in Texas ruled that the Affordable Care Act’s individual mandate is no longer permissible under Congress’s taxing power and that the entire Affordable Care Act (ACA) is invalid because the individual mandate is “essential” to the ACA and is “inseverable” from the ACA’s remaining provisions.

 

Nevertheless, the ACA remains in effect for now because the court did not issue an injunction to stop the enforcement of the ACA. The decision will undoubtedly be appealed all the way to the US Supreme Court. During that time, the ACA will remain in effect pending the appeals. Until all appeals are exhausted, employers and individuals must continue to comply with all applicable ACA requirements.

 

Breaking News: Although the judge did not issue an injunction to stop the enforcement of the ACA, he issued a stay in the case on Sunday. He said the ruling should not go into immediate effect “because many everyday Americans would otherwise face great uncertainty” during an appeal.