Small Businesses Receive Help

IRS Small Business Health Care Tax Credit




The new Internal Revenue Service (IRS) Small Business Health Care Tax Credit helps small businesses and small tax-exempt organizations afford the cost of covering their employees’ health care benefits.



Eligibility Rules



For-profit and tax-exempt employers may qualify. However, all three of the following criteria must be met:



1.The employer must cover at least 50 percent of health care coverage costs for workers based on the employee-only (single) rate.

2.The employer must have no more than the equivalent of 25 full-time workers (not counting owners or family members).

3.Employees’ average annual wages (not counting owners or family members) must be below $50,000.



Credit Amount



•The maximum credit is worth up to 35 percent of a company's premium costs in 2010 (25 percent for tax-exempt employers).

◦Note that the rate will increase to 50 percent on Jan. 1, 2014 (35 percent for tax-exempt employers).



•The credit gradually phases out for employers with average wages between $25,000 and $50,000, and for employers with the equivalent of between 10 and 25 full-time workers.



Employer Notification/Support Materials


The IRS is informing potentially eligible small business groups about this tax credit. Visit the IRS site for additional support materials, including a video and frequently asked questions.



We will communicate the tax credit program with applicable existing customers before, during and after the renewal process. For more information, contact your UnitedHealthcare representative.


This could help small businesses afford richer plans or simply save in their monthly premiums.

More news to follow regarding the health care reforms being implemented.

Please call me with any questions - 503-524-5700. 

Susan Gsell