Yesterday the IRS Announced a new Tax Credit that will help many small business and tax-empty organizations that provide health insurance coverage for their employees.
The Patient Protection and Affordable Care Act, a tax credit included in the health care reform legislation, is designed to encourage small employers to offer health insurance overage for the first time or maintain coverage they already have.
Patient Protection and Affordable Care Act, Tax Credit Facts:
|- The maximum credit is 35% of the premiums paid by 2010 by eligible small business employers|
- 25% of the premiums paid by eligible small business employers and 25% of premiums paid by eligible employers that are tax-exempt organizations.
-In 2014, the maximum credit increased to 50% of premiums paid by eligible small business employers and 35 percent of premiums paid by eligible employers that are tax-exempt organizations.
-The maximum credit goes to smaller employers — those with 10 or fewer FTEs — paying annual average wages of $25,000 or less.
-Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return they file in 2011.