What's the minimum you can pay and still be ACA-compliant?
Find your safe harbor rate before you set wages or finalize open enrollment contributions.
Use our ACA Affordability Calculator to find the lowest hourly or salary rate you can offer while keeping your employee-only medical plan affordable under IRS safe harbor rules. Updated for the 2025 (9.02%), 2026 (9.96%), and 2027 (10.22%) plan years.
Rate of Pay Safe Harbor
Enter your figures — results update as you type.
You can charge up to
This calculator estimates compliance under the IRS Rate of Pay safe harbor. It does not replace professional advice. Affordability rates are indexed annually — the threshold is 9.02% for plan years beginning in 2025, 9.96% for plan years beginning in 2026, and 10.22% for plan years beginning in 2027 (it was 8.39% for 2024). Select the plan year above to match your situation, and verify with ACA 360 before finalizing rates.
Three safe harbors. One that fits.
The IRS gives employers three ways to demonstrate plan affordability. Most employers default to one — and miss the savings or compliance margin the others would provide.
Side by side
The most you can charge under each safe harbor
Hourly employee at $15.00/hr · 2025 plan year
Uses the figures from the calculator above, so the bars move as you change them. The W-2 bar assumes a full year at that pay with the premium taken pre-tax, which lowers Box 1.
Rate of Pay
Your lowest hourly rate times 130 hours, or the monthly salary. Easy to administer, and often the most generous for hourly workforces. You can't use it for anyone whose pay was cut during the year.
rate × 130 hrs × 9.02%
W-2 Wages
Box 1 of the employee's Form W-2. Pre-tax premiums and fewer hours both shrink Box 1, so you only know you passed after the year ends.
Box 1 wages ÷ 12 × 9.02%
Federal Poverty Line
One fixed monthly cap for everyone, based on the prior year's poverty guideline. It's the simplest to prove and the lowest ceiling, so you give up room on pricing.
poverty line ÷ 12 × 9.02%
What happens if you get this wrong?
Getting affordability wrong triggers 4980H(b) penalties. For 2025, that's $4,350 per employee who went to the marketplace and received a subsidy. Get it right before you finalize your plan.
Want this checked against your actual workforce?
We'll review your roster, premiums, and plan design and tell you exactly where you stand on affordability — and where you have margin to tighten.