Small Business Tax Credit
Certain small businesses that offer health benefits are eligible for a health care tax credit. These vary depending on the tax-exempt tax 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 (35% for non-profits)
- The average annual wage level at which the tax credit begins to phase out for eligible small employers is approximately $25,800
- The maximum average annual wages to qualify for the credit as an "eligible small employer" for 2015 will be twice this amount, i.e., $51,600
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.