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— FIVE FACTS ABOUT THE SMALL BUSINESS HEALTH CARE TAX CREDIT

Posted by Admin Posted on July 29 2018

facts five about the small business health care tax credit

 

If you are a small employer, there is a tax credit that can put money in your pocket. The small business health care tax credit benefits employers that:

- Offer coverage through the small business health options program, also known as the SHOP marketplace

- Have fewer than 25 full-time equivalent employees

- Pay an average wage of less than $50,000 a year

- Pay at least half of employee health insurance premiums

Here are five facts about this credit:

- The maximum credit is 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers. 

- To be eligible for the credit, you must pay premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program Marketplace, or qualify for an exception to this requirement.

- The credit is available to eligible employers for two consecutive taxable years beginning in 2014 or later. You may be able to amend prior year tax returns to claim the credit for tax years 2010 through 2013 in addition to claiming this credit for those two consecutive years.

- You can carry the credit back or forward to other tax years if you do not owe tax during the year.

- You may get both a credit and a deduction for employee premium payments. Since the amount of your health insurance premium payments will be more than the total credit, if you are eligible, you can still claim a business expense deduction for the premiums in excess of the credit.    For more information, see the small business health care tax credit page on IRS.gov. 

If you have any questions regarding accounting, domestic taxation, international taxation, IRS representation, U.S. tax implications of Real Estate transactions or financial statements, please give us a call at 305-274-5811.

Source: IRS

The information provided on the LBCPA Blog is a community service for general information purposes only, and should not be used as a substitute for consultation with professional advisors who specialize in the topics covered. Please refer to your advisors for specific advice on these subjects. The information is not intended to be used, and it cannot be used, for the purposes of avoiding U.S. Federal and/or State tax laws or the tax laws of any foreign jurisdiction.

These blogs contain general information only and Lord Breakspeare Callaghan LLC or any of the other companies or firms presenting information are not providing accounting, business, financial, investment, legal, tax, or other professional advice or services. Lord Breakspeare Callaghan LLC or any of the other companies or firms contributing with articles shall not be responsible for any loss sustained by any person who relies on this information.

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