2011 Tax Credit for Business Insurance
New tax credits for small businesses that provide insurance for employees are available this year thanks to new legislation pushed by the Obama administration. Small businesses may be able to save as much as 35% of their tax money by taking advantage of this credit, if workers get healthcare through the company.
About the Tax Credit
One year ago, the Affordable Care Act passed both houses of congress. In addition to helping families, the Democrat-led legislation promised to give small businesses the resources to do better in the market place. This, in turn, would help create jobs and improve the economy.
Small business owners were not the only people the act promised to help; employees of small businesses were a large part of the healthcare crisis in the United States, and supporters of the act envisioned it encouraging small businesses to provide healthcare coverage to employees.
Now, as incentive, small businesses that cover at least 50% of their employees insurance costs qualify for a large tax credit.
Advocates of the law say that, not only will more families receive healthcare coverage, businesses will be able to reinvest thousands in order to find more success, thus creating more jobs.
Who qualifies?
In order to get the sizable tax credit, a small business must meet a number of requirements:
- Have 25 or fewer employees
- Pay average wages of less than $50,000 per employee
- Have provided health insurance coverage (or begun coverage) for employees in 2010
- Contribute 50% (at least) of premiums
- Use single coverage rate for employees
Part-time employees count proportionately.
While it seems like these are strict regulations, as many as 10 million small businesses in the United States qualify for this credit.
Use the simple qualification forms on the IRS website for more help.
How to Take Advantage
All you have to do is enroll in an employee healthcare program, which you can find by doing a small business insurance search right here, and pay 50% of the cost.
Other tax breaks and government incentives.
It gets even better in 2014!!!
Does saving 35% of taxes sound good? How about 50%?
In 2014, tax credits for coverage-providing businesses will jump to 50%.
If providing health insurance for employees is still too expensive, you will be able to band together with other small businesses to buy collectively, reducing the amount you have to pay.
Research shows that the 2014 measures will significantly reduce the average cost of healthcare in the United States by making premiums more competitive.
Take Advantage Now
Repeal efforts are already on their way, though the President has vowed to fight them and veto if necessary. In reality, the government is losing very little tax revenue from these incentives, and the numbers coming back show that more people have begun to get health coverage. So far, so good.
In terms of cuts, there are bigger fish to fry for the Republican house, but that doesn’t mean you should sit on your backside while this opportunity passes you by. The tax breaks for small business insurances are guaranteed for the moment, but they might not be around forever. Start using them and reinvesting today.
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