Individuals & Families Employers Brokers Physicians Health & Wellness

Small Business Health Care Tax Credit

Timeline of Provisions

Small Business Tax Credit


Certain small businesses that offer health benefits are now eligible for health care tax credits. These vary depending on the tax-exempt status of the organization and employer contribution toward health benefits.

  • Eligible employers must pay at least half the cost of single coverage for their employees.
  • There must be no more than 25 full-time equivalent (FTE) employees, not counting owners or their family members.
  • Average annual wages of employees must be less than $50,000 (adjusted for inflation beginning in 2014) per FTE.

The Small Business Health Care Tax Credit is designed to encourage small businesses and small tax-exempt organizations to offer health insurance coverage for their employees. The credit is targeted specifically to help businesses and organizations that employ moderate- and low-income workers.

If you currently provide health insurance coverage for your employees, you may qualify for the tax credit.

Video: Small Business Tax Credit

Learn about eligibility for the Small Business Tax Credit, and how it may affect your business. View video

UnitedHealthcare developed a modeling tool to assist employers and brokers in determining eligibility for the credit and estimating the potential credit amount. If the employer meets eligibility requirements, the modeling tool uses the state-specific average premium amount to calculate the estimated credit amount.

For More Information

The modeling tool is for illustrative purposes only, and does not constitute legal or tax advice. UnitedHealthcare does not warrant or certify the results of using the tool. Employers should consult with their own tax and legal representatives before finalizing any plans based on the use of this tool. The modeling tool is valid for tax years before Jan. 1, 2014.