How much will my taxes be with the health reform?

2010 Small Employers -- Health Care Reform and Tax Credits

WHAT EVERY SMALL BUSINESS SHOULD KNOW ...
The new health reform law states that small businesses with 25 or less full-time employees may be eligible to receive the Small Business Health Care Tax Credit when providing health care coverage to their employees.
________________

Effective 2010:
· Tax credit of up to 35% of premium
contributions

· Credit amount is lower as number of
employees and average wages increase

· Full credit to businesses with 10 or fewer full
time equivalent employees and average
annual wages of less than $25,000


Starting in 2014:

· States will be required to set up insurance pools
called SHOP Exchanges (Small Business
Health Option Programs) which will allow small
businesses to group together to buy health
insurance

· Receive 50% tax credit with a company of
10 or fewer employees who earn $25,000 or
less on average

· Employers with 50 or more full-time
employees may be subjected to penalties
under the law if they do not provide health
insurance coverage

Assessable penalties range from $2,000-$3,000 per employee. The first 30 employees are not counted for purposes of calculating assessable penalties
________________

TAX CREDIT ELIGIBILITY
·Employ 25 or less full-time (equivalent) employees*
·Average annual wages less than $50,000*
·Purchase health insurance for employees
. Employer must contribute at least 50% of premium

*Owners, partners, shareholders, and family members are excluded from employee count, wage calculation, and tax credit.

QUALIFICATION CALCULATOR

STEP 1. Determine total number of employees*

Full-time employees (A):_________
(enter the number of employees who work at least 40 hours per week)
+
Full time equivalent of part-time employees (B) :__­­­­­­­­­­______
(calculate number of full-time equivalents by dividing total annual hours of part-time employees by 2080)
A + B = ____________ total number employees
If "total number employees" is less than 25, go to Step 2.

STEP 2. Calculate average annual wages of employees

Take the total annual wages paid to employees: $_______________________
÷
Divide it by " total number employees" from step 1:___________
(total wages ÷ number of employees)
= $_________________average wages

If the result is less than $50,000 AND... (go to Step 3)

STEP 3. If you pay at least half of the insurance premiums for your employees at the single (employee-only) coverage rate, then you may be eligible to claim the Small Business Health Care Tax Credit.


For more Information contact Teri Frankel or
Galo Pacheco at TCB Insurance Services
818-999-6066
www.tcbinsurance.com
TCB Insurance is a premier insurance services firm with a primary focus on small to medium-sized business. The company offers a wide range of services including employee healthcare plans (medical, dental, vision), group term life insurance, HSA, FSA, and voluntary benefit plans. With over 20 years of experience and a steadfast dedication to customer service, we take meticulous care of every insurance detail so that our clients can rest easy and focus on their core business.