Small Business Health Care Tax Credit

As a result of the Affordable Care Act (ACA), qualified small employers may be eligible to receive a tax credit for a portion of the health insurance premiums paid on behalf of their employees. The Internal Revenue Service recently released a reminder regarding the credit.

There are several requirements for small businesses to qualify for the credit. The small business must have fewer than twenty-five (25) full time equivalent employees, pay an average wage of less than $50,000 a year, and pay at least half of the employee health insurance premiums. Additionally, the employers must be enrolled in a qualified health plan offered through a Small Business Health Options Program Marketplace, or meet certain exceptions to the requirement.

The maximum credit is 50% of the premiums paid. Portions of the credit are phased out for employers paying employees over $25,000 and employers with more than 10 full time employees. The credit may not be claimed for more than two consecutive years.

If your business might qualify for the Small Business Health Care Tax Credit, a calculator is available through Healthcare.gov to estimate your tax credit, see https://www.healthcare.gov/shop-calculators-taxcredit/

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New Nebraska Tax Credit for Volunteer Emergency Responders

In an effort to aid in the recruiting and retention of volunteer emergency responders, volunteer firefighters, and volunteer rescue squad members, Nebraska passed LB 886, known as the Volunteer Emergency Responders Incentive Act. By enacting this law, volunteer first responders are potentially eligible for a $250 refundable tax credit.

To qualify for the tax credit, the volunteer must be an active rescue squad member, active volunteer firefighter, or active emergency responder. To meet the activity requirements, the law uses the point system currently in place, requiring the volunteer to acquire 50 points out of a potential 100 in the given year. These points are awarded based upon the volunteer responding to emergency calls, participating in training, and other similar activities.

The point system will be maintained by each volunteer department, which will annually certify a list of volunteers meeting the points threshold to the Nebraska Department of Revenue. Starting with the second year that a volunteer is certified on the list, the volunteer can claim the $250 refundable tax credit.

© 2016 Vandenack Williams LLC
For more information, Contact Us