The Small Business Administration (SBA) has launched a new blog series to educate small business owners about what they need to now about the Affordable Care Act before it goes into full effect in January of 2014. The new series tackles common misperceptions about the ACA; one post details the top three things small business owners need to know about the ACA:
- Tax Credits for Businesses with Less Than 25 Employees. Businesses that have fewer than 25 employees will not be required to provide health insurance under the Affordable Care Act, but those businesses are offered tax credits of up to 35% if they do provide health insurance for employees. Qualifications to get the tax credit include:
- Business employs fewer than 25 full-time employees
- Average annual wage is less than $50,000
- Business contributes 50% or more toward health insurance premiums for employees
This tax credit will rise to 50% in 2014 and will be available to small businesses that participate in the Small Business Health Options Program (SHOP) Exchanges.
- Affordable Insurance Marketplaces for Businesses with Less Than 50 Employees. Beginning in 2014, small businesses with fewer than 50 employees will not be required to provide health insurance, but will have access to the Small Business Health Options Program (SHOP) Exchanges, a competitive health insurance marketplace for small employers to find affordable coverage for employees. Open enrollment begins Oct. 1, 2013.
- Employer Shared Responsibility Provisions for Businesses with 50+ Employees. Starting in 2014, businesses with 50 or more full-time employees that do not offer health insurance to their employees may be subject to what is called an “employer shared responsibility payment” if at least one full-time employee (someone who works an average of 30+ hours per week) receives a premium tax credit to purchase coverage in an insurance Marketplace.
If you’re a small or mid-size business owner, call us today to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit.