Up to 35 Percent Credit for Health InsuranceNovember 20th, 2013
You may be eligible for a credit of up to 35 percent of the cost of your healthcare insurance premium. In order to help you understand the health care credit, we will outline the basics of the law.
Can You Claim The Credit?
To be eligible, you must cover at least 50 percent of the cost of single (not family) health insurance for each of your employees. You must also have fewer than 25 full-time equivalent employees. Those employees must have average wages of less than $50,000 a year. If you qualify, we will need the total premiums paid, number of employees and average wages paid to calculate the credit.
How Much Is The Credit?
For the years 2010-13, the maximum amount of the credit is 35 percent of the amount paid in premiums, which is reduced based upon the number of employees and the average wages. After 2013, the 35 percent credit for taxable entities becomes 50 percent, but will likely be available only to employers who purchase health insurance through a state sponsored health insurance exchange. To get the maximum credit, you must have 10 or fewer employees and average annual wages cannot exceed $25,000 per year.
What is a State Exchange?
The Health Care Law requires each state to set up a health insurance exchange, which is intended to be a competitive marketplace for health insurance for individuals and small businesses. If a state does not set up an exchange, the law permits the federal government to step in and set up an exchange. If you have any questions, please call our office.
Tucson CPA and Tax Firm, Flower Rieger and Associates, P.L.L.C. offers tax preparation for businesses and individuals. The CPAs of Flowers Rieger are also offers aggressive tax strategies and planning, accounting and bookkeeping, financial statement preparation, estate and trust tax preparation and more CPA services.