Posted by Molly Nelson - The IRS released guidance today on the new health care tax credit under the Affordable Care Act to help small businesses determine whether they qualify
for the credit and estimate the amount of the credit they may receive.
According to the IRS guidance, small businesses that receive state health care tax credits may still qualify for the full federal tax credit, and small businesses are allowed to receive the credit for additional dental and vision coverage as well as regular health insurance.
The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees in 2010.
For tax years 2010 to 2013, the maximum credit is 35 percent of premiums paid by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax exempt organizations.
Read the IRS guidance, Notice 2010-44, here. Visit the Affordable Care Act page for more information about the credit.