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 health care tax credit and how large a credit they could receive. The guidance also makes clear that small businesses receiving state health care 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.

Must Report Coverage Value on W-2 Forms

Employers are required to report the value of health care 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.