A great 2010 tax credit for small business

When filing your 2010 taxes next month, small business owners can be thankful for the Affordable Care Act that was signed into law this time last year. Small business owners have been offered a one-time credit that can save upwards of 35 percent on health care premiums for their workers. According to estimates, small businesses that are eligible for a tax credit employ and offer small group health insurance to approximately16.6 million workers nationwide.¹

The IRS states that a business that employs 10 people with an average wage of $25,000 per employee, and a total cost of $70,000 per year in health insurance premiums could get a tax credit of 35 percent of their premium cost, which equals up to $24,500.

If you or anyone you know is interested in promoting this tax credit for future years, contact your elected officials. You can also voice your opinion with Communicating for America, a nonprofit association dedicated to working with small businesses and people in rural communities, giving them a forum for their concerns to be heard in Washington D.C. To learn more about the small business tax credit visit the IRS website.

1) Collins SR, Davis K, Nicholson JL, and Stremikis K. Realizing Health Reform’s Potential: Small Businesses and the Affordable Care Act of 2010. The Commonwealth Fund, September 2010