As the end of the year approaches, NGLCC wants small employers to know that they can begin taking advantage of the most immediate benefit of the Affordable Care Act—the small business health care tax credit.
The IRS has released a new one-page form, Form 8941, to guide small businesses that are eligible for this new tax credit. Businesses can use the form to determine the credit they're eligible for so that they can accurately claim the amount on their 2010 tax year forms.
Intended to encourage small businesses to offer health insurance to their employees or continue doing so, the credit is generally available to employers of fewer than 25 employees who pay at least half of the premiums for single health insurance coverage and have average wages under $50,000.
"There are opportunities for small businesses, many of them LGBT-owned, to take advantage of tax incentives this year from the health reform bill, and I encourage every business owner to investigate whether or not they qualify," said Justin Nelson, NGLCC co-founder and president. Nelson noted that there are significant tax advantages that will come into play between now and 2014 that will be good for business owners.
For tax years 2010 to 2013, firms with 10 or fewer full-time employees that pay annual average salaries of $25,000 or less can receive the maximum credit of 35 percent of paid health insurance premiums. The credit is completely phased out for employers of 25 or more workers or that pay average annual wages of $50,000 or more. Beginning in 2014, the maximum tax credit will increase to 50 percent of premiums paid by eligible small businesses.
For more information about Form 8941 and the health care tax credit, click here.
To download Form 8941, click here.
