Small business owners may be seeing postcards from the Internal Revenue Service advising them of a potential tax credit in relation to health insurance they provide their workers. This tax credit is part of the Patient Protection and Affordable Care Act which was signed into law by President Obama.
Many of the postcards have already been sent out but for small business owners that are unaware this tax credit, it is for small employers that are paying at least half of the healthcare costs for their employees. Also, this tax credit is available for tax-exempt organizations and has a maximum credit value of 35% of the premiums paid by small businesses and 25% of the premiums paid for tax-exempt organizations.
Those who are eligible for this tax credit are going to be able to claim it on their 2011 tax form and the credit is said to be through tax years 2010 to 2013, according to the IRS website.
Many employers and small business owners find that they benefit more from providing health care coverage for their employees. Health insurance often gives employees peace of mind and keeps them loyal when they know that their employer will take care of them in the case of illness or injury.
It’s hoped that this new tax credit is going to prompt more small businesses to start looking into their health insurance options for workers. Many small businesses avoid providing health insurance due to the costs of healthcare, which has many small business owners thinking that it will be a drain on company funds.
However, even before this tax credit on health insurance for small businesses, many business owners found that by providing healthcare coverage for their employees they not only keep their employees happier, they also find they attract more high level talent, and in some cases even have workers willing to take less in their wages as long as they have excellent health care coverage.
Small business owners that are currently providing healthcare coverage or are seeking to provide health care coverage may want to look into their eligibility in this tax credit program from the Obama administration.