(Easy) Obamacare Money
For You Business or Non-Profit

Zen Mensch Accounting

Don’t leave money on the table.  Lost in the hubbub about the error-plagued website roll-out:  There have been lucrative tax credits available to very small businesses and non-profits since 2010.  And they are about to get more lucrative.

How lucrative?  For 2013, up to 35% of the premiums you paid for your employees.  For 2014, up to 50%. Really! No muss, no fuss, no caveats? No way! Here’s the skinny (no trans-fats allowed in healthcare discussions.):

  • The maximum credit is available for companies with 10 or fewer employees who earned an average wage of $20,000 or less. The credit is unavailable if your firm employs 25 or more “full-time equivalent” employees or if the staff’s average wage (excluding the owners) exceeds $50,000. In between there is a sliding scale.
  • You must pay at least 50% of your employees’ premiums.
  • Starting in 2014 you must purchase the insurance through Obamacare’s “SHOP exchange”, which will require a broker until November, 2014, when it is scheduled to (finally) be available online.
  • Your savings may be less than a dollar for dollar credit, for reasons that are beyond the scope of this article and the author’s ability to explain them lucidly in a brief newsletter! It depends on the tax situation of the company or owner who is claiming the credit.
  • Non-profits with employees may also claim the credit even if they do not normally file taxes; their maximum credit or refund is 25% (35% in 2014).

Crying Uncle yet?  It IS complicated and you MAY need an ACCOUNTANT (who may need a Tylenol). But your small business or organization may still end up saving thousands of dollars in healthcare costs.

NOTE: Every situation is different and federal and state tax laws are subject to change.  This article is presented exclusively for informational purposes and is not intended to substitute for obtaining tax or financial advice from a tax or other business professional.

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