rp-16-24.pdf

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26 CFR 601.105: Examination of returns and claims for refund, credit, or abatement;
determination of correct tax liability.
(Also §§ 36B, 5000A; 1.36B-2T, 1.36B-3, 1.5000A-3.)

Rev. Proc. 2016-24

SECTION 1. PURPOSE

This revenue procedure provides indexing adjustments for certain provisions
under sections 36B and 5000A of the Internal Revenue Code. In particular, it updates
the Applicable Percentage Table in § 36B(b)(3)(A)(i) to provide the Applicable
Percentage Table for 2017. This table is used to calculate an individual’s premium tax
credit. This revenue procedure also updates the required contribution percentage in
§ 36B(c)(2)(C)(i)(II) for plan years beginning after calendar year 2016. The percentage
is used to determine whether an individual is eligible for affordable employer-sponsored
minimum essential coverage under § 36B. This revenue procedure uses the
methodology described in Section 4 of Rev. Proc. 2014-37, 2014-2 C.B. 363, to index
the Applicable Percentage Table and the § 36B required contribution percentage for
2017. Rev. Proc. 2014-37 provides indexing adjustments for these amounts for 2015
and Rev. Proc. 2014-62, 2014-2 C.B. 948, provides indexing adjustments for these
amounts for 2016. Additionally, this revenue procedure cross-references the required
contribution percentage under § 5000A(e)(1)(A) for plan years beginning after calendar
year 2016, as determined under guidance issued by the Department of Health and

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Human Services. The percentage is used to determine whether an individual is eligible
for an exemption from the individual shared responsibility payment because of a lack of
affordable minimum essential coverage.
SECTION 2. ADJUSTED ITEMS

.01 Applicable Percentage Table for 2017. For taxable years beginning in 2017,
the Applicable Percentage Table for purposes of § 36B(b)(3)(A)(i) and § 1.36B-3T(g) is:

Household income percentage of Federal
poverty line:
Initial percentage Final percentage
Less than 133% 2.04% 2.04%
At least 133% but less than 150% 3.06% 4.08%
At least 150% but less than 200% 4.08% 6.43%
At least 200% but less than 250% 6.43% 8.21%
At least 250% but less than 300% 8.21% 9.69%
At least 300% but not more than 400% 9.69% 9.69%

.02 Section 36B Required Contribution Percentage for 2017. For plan years
beginning in 2017, the required contribution percentage for purposes of
§ 36B(c)(2)(C)(i)(II) and § 1.36B-2T(c)(3)(v)(C) is 9.69%.
.03 Section 5000A Required Contribution Percentage. In the 2017 Benefit and
Payment Parameters, 81 Fed. Reg. 12203 (March 8, 2016), for plan years beginning in
2017, the Department of Health and Human Services (HHS) announced that the
Section 5000A required contribution percentage for purposes of § 5000A(e)(1)(A) and
§ 1.5000A-3(e)(2) is 8.16%. See Exchange and Insurance Market Standards for 2015
and beyond, 79 Fed. Reg. 30239, 30302 (May 27, 2014), for further information on the
computation methodology and publication approach for the Section 5000A required
contribution percentage.
SECTION 3. EFFECTIVE DATE

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This revenue procedure is effective for taxable years and plan years beginning
after December 31, 2016.
SECTION 4. DRAFTING INFORMATION

The principal author of this revenue procedure is John Lovelace of the Office of
Associate Chief Counsel (Income Tax and Accounting). For further information
regarding this revenue procedure, contact Mr. Lovelace at (202) 317-7006 (not a toll-
free call).