Small Business Health Care Tax Credit



hi I'm Chanel and I work for the Internal Revenue Service are you an employer with fewer than 25 employees get the credit you deserve the small business health care tax credit whether you're a for-profit business or tax-exempt group if you pay at least half the cost of premiums for single coverage health insurance for your employees you may qualify the credit has been around since tax year 2010 but some of the rules change for tax years beginning in 2014 or later first the maximum credit increases from 35% to 50% for small business employers and from 25% to 35% for small tax-exempt employers next to claim the credit generally employers must offer employees insurance purchased through the small business health options program known as the shop marketplace and finally in 2014 and subsequent years the credit is only available to eligible employers for two consecutive taxable years although the maximum credit amount changes the definition of a small employer has not usually a small employer for the purpose of the credit is an employer with fewer than 25 employees and those employees must earn low-to-moderate wages there are other special rules for example to halftime employees generally count as one full-time employee so if you have more than 25 employees and some are not full-time you may still qualify for the credit if you're a small business you'll claim the credit as part of the general business credit on your income tax return using form 8941 if you have no text do you can carry the credit back or forward to other years and since the credit will be less than the full amount of your premium payments you may be eligible to claim a business expense deduction for the difference that's both a credit and a deduction for employee health insurance premium payments if you're a tax-exempt employer you'll climb the credit on form 990 and for you the credit is refundable that means you can get it even if you owe no tax for more information go to irs.gov slash ACA

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