How Reform Impacts Your Employer
Tax Credits for Premium Contributions
Qualified small businesses are eligible for tax credits for their contributions to purchase health insurance for employees.
Small Groups May Choose Not to Offer Coverage
The new law does not require that small businesses (those with 50 or fewer workers) provide coverage to their employees. It does provide tens of billions of dollars in new tax credits to small businesses to make it easier for them to provide coverage if they choose to do so.
Employer Tax Credit Toolkit
If you're an employer, new reforms may enable you to provide health coverage for your employees. The Small Business Health Care Tax Credit, a provision of the PPACA, helps small businesses and small tax-exempt organizations afford the cost of covering their workers.
Download the Small Business Tax Credits Brochure
Are you eligible?
The IRS offers a number of resources to help businesses determine their tax credit eligibility status.
New Guidance on Small Business Tax Credits
In Notice 2010-44, detailed new guidance is provided by the IRS on how small businesses can determine whether they are eligible for the new healthcare tax credit and how large a credit they could receive. The guidance also makes clear that small businesses receiving state healthcare tax credits may still qualify for the full federal tax credit. Additionally, the guidance allows small businesses to receive the credit not only for regular health insurance but also for add-on dental and vision coverage when the employer meets certain requirements.
Fines for Not Providing Insurance
Beginning in 2014, businesses with more than 50 full-time employees (those working an average of at least 30 hours per week) who do not offer coverage to their employees must pay $2,000 annually for each full-time employee over the first 30 as long as at least one of their employees receives a tax credit.
Groups of 200+ Must Auto-Enroll Employees
In 2014, employers with 200 or more employees will be required to auto-enroll their employees in health coverage, with the ability for employees to opt out.
Must Report Coverage Value on W-2 Forms
Employers are required to report the value of healthcare benefits on employees' W-2 tax statements. This went into effect in 2011.
Help with Insurance Costs
Some existing health plans are "grandfathered" from having to comply with certain provisions of the PPACA. These are group plans that already were in existence before March 2010 when the law was enacted. As long as a group renews its coverage annually without changes, it remains a grandfathered plan.
