ALE (Applicable Large Employer)

What is meant by ALE (Applicable Large Employer)?

An ALE or Applicable Large Employer is an employer that has an average of full-time 50 employees or full-time employee equivalents (FTEs) either from a single entity or group of correlated entities. FTE means a group of two or more employees who collectively works for 30 hours per week or more. So, if an ALE has employees working for 15 hours each, it means it has one FTE.  In the case of a group of multiple entities, ALE is called ALE members. 

The term ‘ALE’ is used by ACA (Affordable Care Act). As per ACA, large companies should report data to the government yearly. If an ALE fails to comply, it might face penalties from the IRS. To come in the category of an ALE, it is not necessary to have FTEs every time. Instead, ACA analyzes an average of full-time workers in a particular year. 

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