The per-day excise tax applies to which party?

Prepare for the Consolidated Omnibus Budget Reconciliation Act (COBRA) Test. Utilize flashcards and multiple choice questions, each with hints and explanations. Ace your test with confidence!

Multiple Choice

The per-day excise tax applies to which party?

Explanation:
The per-day excise tax is imposed on the plan sponsor, i.e., the employer. Under COBRA, the employer (as the sponsor and administrator of the group health plan) is responsible for ensuring timely continuation coverage notices and offers. If the employer fails to comply, an excise tax can accrue daily for each violation and for each affected individual, creating a strong incentive to administer COBRA correctly and promptly. Employees, beneficiaries, and insurance carriers are not the parties responsible for this tax.

The per-day excise tax is imposed on the plan sponsor, i.e., the employer. Under COBRA, the employer (as the sponsor and administrator of the group health plan) is responsible for ensuring timely continuation coverage notices and offers. If the employer fails to comply, an excise tax can accrue daily for each violation and for each affected individual, creating a strong incentive to administer COBRA correctly and promptly. Employees, beneficiaries, and insurance carriers are not the parties responsible for this tax.

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