Small Employer Health Benefit Tax Credit
To qualify for the full 35% credit (that's getting back 35% of what you pay for employees' health insurance) you must:
1. Offer health insurance to every employee who wants to enroll..
2. Pay a uniform percentage of at least 50% for all employees. This can be the cost of single coverage, even for your employees who elect family coverage.
3. Have 10 or fewer full-time equivalent employees, excluding owners and family, and
4. Pay average wages of $25,000 or less, excluding owners and family.
If the company has 11 - 24 full-time equivalent employees, or if the average wages are $25,000 - $50,000, the amount of the credit is reduced, and beyond that the credit falls to zero.
Burlingame - San Mateo - Foster City CPA Since '88
Don't miss
important tax news and
due date reminders!
or
(We won't share)
Answers to many of your tax questions can be found here
If you have a tax question that you think other people would be interested in, send it to me. If I use it in my Tax News Blog or on my General Tax Info Page,I'll send you a Starbucks card!
This credit is in effect now and will be claimed on the company's annual tax return. (This is different than the "payroll tax holiday" tax reduction, which is claimed on the quarterly payroll tax returns as the year goes along.) It's available for all business types: corporations, LLCs, partnerships, and self-employed.
The are many details not included above, plus the IRS is still releasing clarifications. I strongly recommend that you consult with an experienced CPA if you think that your business might qualify for this tax credit.
Bess Kane, CPA bess@besskanecpa.com
March, 2012
