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To determine if your small business or tax-exempt organization qualifies for the Small Business Health Care Tax Credit, follow these three simple steps:
STEP 1: Determine the total number of your employees (not counting owners and family members):
Full-time employees: ____________ (enter the number of employees who work at least 40 hours per week)
PLUS
Full-time equivalent of part-time employees: ____________ (calculate the number of full-time equivalents by dividing the total annual hours of part-time employees by 2080)
= Total employees __________
If the total number of employees is fewer than 25, go to STEP 2
STEP 2: Calculate the average annual wages of employees (not counting owners and family members):
Take the total annual wages paid to employees: ______________
DIVIDED BY
The number of total employees from STEP 1: ______________
= Average wages ___________
If the result is less than $50,000, AND
STEP 3: You pay at least half of the insurance premiums for your employees at the single (employee-only) coverage rate, then...
You may be able to claim the
Small Business Health Care Tax Credit.
Under certain circumstances, there are additional rules to determine the employees taken into account, the number of hours of service worked by employees for the taxable year, the number of an employer's full-time equivalents, and the premium payments by the employer for the taxable year.
We will be happy to assist you in determining if you may be able to claim the Small Business Health Care Tax Credit. If you have any questions about this new tax credit program, please contact Kathleen Kaminski, CPA at 315.701.6322 or KKaminski@GreenSeifterCPAs.com.
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