Tax Credits Available for Small Businesses
Small businesses are very interested in the tax credits offered under reform. Blue KC’s BlueChoice® package of plans for small businesses can help these employers maximize their savings with the tax credit and gain control over employees’ health care costs.
Effective for 2010, many small businesses and not-for-profit organizations providing health insurance to their employees will qualify for a special tax credit of up to 35% (25% for tax-exempt organizations). This tax credit is designed to encourage small businesses to offer or continue to offer health insurance to their employees. There are certain eligibility criteria that must be met, and that information is available at www.IRS.gov. In general, the tax credit is available to small businesses that pay at least half the cost of single coverage for their employees, employ fewer than 25 employees AND pay wages averaging less than $50,000 per year.
The maximum credit (i.e. 35%) is available to smaller employers, those with ten or fewer employees, paying annual average wages of $25,000 or less per year. In 2014, the tax credit will increase to 50% of premiums paid by eligible small businesses and 35% of premiums paid by eligible tax-exempt organizations.