The Internal Revenue Service has come out with guidelines for small commercial and nonprofit employers that want to take advantage of a new health insurance tax break. PPACA and a companion act, the Health Care and Education Reconciliation Act, are part of what federal agencies have dubbed the Affordable Care Act(ACA). This year, the new ACA small business tax break will offer small employers a tax credit equal to at least half the cost of single coverage, if the employees earn average wages of less than $50,000 per year. The tax credit is not available to ordinary government employers, but it is available to small businesses, small tax-exempt employers, and government-affiliated tax-exempt employers that can be described as section 501(c) organizations. Here are some of the highlights of this provision:
- Tax years 2010 to 2013, the maximum credit is 35% of premiums paid by eligible small business employers and 25% of premiums paid by eligible employers that are tax-exempt organizations.
- Employers with 10 or fewer FTE employees that pay annual average wages of $25,000 or less can qualify for the maximum credit.
- Employers with 10 to 25 FTE employees that pay annual wages of $50,000 or less can qualify for a smaller tax credit.
For the full review of this new IRS Section 45R and to see whether or not you qualify for this new tax credit
CLICK HERE. I highly recommend that you speak with your employee benefits broker/consultant for expert advise on what you're entitled to or if you're not currently working with a broker email me at
bknauss@employeemployersolutions.com or visit me on the web at
www.employeemployersolutions.com
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