NEW 35% TAX CREDIT FOR SMALL BUSINESSES (2-25 EMPLOYEES)
Small Businesses Can Benefit from Health Care Savings Opportunities Just in time for tax season, new online tool helps identify savings.
There is exciting news for your small business clients and prospects looking to reduce costs when it comes to health insurance. Beginning in 2010, the Affordable Care Act and IRS began offering up to a 35 percent tax credit savings on health and dental insurance.*
This new credit helps small businesses and tax-exempt organizations (with 2-25 employees) afford the cost of covering their employees and is specifically targeted for those with low- and moderate-income workers. The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have.
Eligibility To be eligible for the tax credit, a small business or tax-exempt organization must:
Provide at least 50 percent of the cost of health care coverage for some of its workers based on the single rate
Employ 25 or fewer full-time workers (an employer with fewer than 50 part-time workers may still be eligible for the credit)
Pay average annual wages below $50,000
Amount of credit The maximum credit that an organization can receive is up to 35 percent of the premium costs. On Jan. 1, 2014, this rate increases to 50 percent.