Claiming the Small Business Health Care Credit
Among the many changes brought on by the Health Care Act of 2010 , Code Sec. 45R, the Small Employer Health Care Credit (the Credit), was designed to encourage small business employers to provide coverage to their employees. However, businesses have been left with several questions as to the specific requirements for eligibility and filing to claim the Credit. Eligible Businesses An eligible business is defined as a business that has fewer than 25 “full-time equivalent” (FTE) employees and pays average wages of $50,000 per year or less. An FTE calculation will take into account aggregate hours worked by part-time employees in determining eligibility. Seasonal. Read More.
IRS Sends Postcard to Millions of Employers Regarding New Health Care Tax Credit
If you receive a postcard from the Internal Revenue Service (IRS) this week, you are not alone. The IRS is currently in the process of mailing postcards to over 4 million small businesses and tax-exempt organizations to raise employer awareness of the benefits now available through the new small business health care tax credit . Included in the Patient Protection and Affordable Care Act , the credit is one of the first of several new health care reform provisions to go into effect. Available for 2010, the credit encourages small businesses and tax-exempt organizations to offer health insurance coverage for the first time or maintain current coverage.
New Health Care Tax Credit Encourages Small Businesses to Provide Coverage
Included in the Patient Protection and Affordable Care Act is a tax credit designed to encourage small businesses to provide health coverage to their employees. Effective for tax years beginning in 2010, the credit equals a percentage of the employer contribution to employee health care plans, provided that coverage equals at least half of the overall plan. The credit will increase for small businesses when state-run marketplaces come into effect in 2014. “This credit provides a real boost to eligible small businesses by helping them afford health coverage for their employees,” said IRS Commissioner Doug Shulman. “We urge small businesses and tax-exempt employers to look closely at this. Read More.
Breaking Down the Health Care Reform Law’s Impact on Small Businesses
The recent enactment of the Patient Protection and Affordable Care Act of 2010, in combination with the Health Care and Education Tax Credits Reconciliation Act of 2010 (collectively known as the “Health Care Act” or the “Act”), will significantly change the nation’s health care landscape and impact small businesses in a number of ways. Given the scope of this landmark legislation, this short summary is by no means a comprehensive review of the new law. As your tax professionals at CB&H continue to study the legislation, we will continue to keep you informed and up-to-date regarding how the Health Care Act will affect you and your business. The Health Care Act requires all individuals not covered by Medicaid or Medicare to obtain minimum essential coverage or pay a penalty (unless they are exempt from the individual responsibility mandate).. Read More.
Small Business Owners Report Mixed Reactions on Passage of Health Care Reform
Yesterday, President Obama signed into law key portions of the health care reform package. But what will this extensive new legislation mean to small businesses? As reported in The Richmond Times-Dispatch , business owners so far have mixed reactions: Small-business owner Katrina VanHuss said she will need her accountant to help her understand the impact of health-care reform on her business. Her gut reaction yesterday to the landmark legislation was mixed. … Five of her 14 employees are covered by the company’s plan. The total costs last year for seven employees, before she laid off about a third of her employees, was about. Read More.
Recession Forcing Some Small Businesses to Drop Healthcare Insurance Benefits
An article in today’s Wall Street Journal reports that a greater number of small businesses are finding healthcare benefits too costly to bear given the current economic climate, and offers a list of alternatives to eliminating health insurance. As the Obama administration wrestles with broader questions of health-care overhaul, tough economic times are forcing more businesses to grapple with stressful questions about discontinuing coverage. Health-insurance premiums for single workers rose 74% for small businesses from 2001 to 2008, the latest year data are available, according to nonprofit research group Kaiser Family Foundation. About 10% of small businesses are considering eliminating coverage over the. Read More.